Trump's Agenda on Drug Prices
Leaked Recommendations Point to Drug Corporation Overreach
Kaiser Health News and The Wall Street Journal recently reported on but did not publish discussion documents circulated within the Trump Administration’s “Drug Pricing and Innovation Working Group”. Public Citizen has obtained copies of three documents, available here.
The documents outline primarily industry-friendly proposals, including some that could jeopardize patient safety or even potentially increase rather than lower medicine prices.
Drug Pricing and Innovation Working Group meeting priorities: This short document, originally described though not published by Kaiser Health News, states principles and talking points from Working Group meetings, dated May 18 and June 1.
These documents do not necessarily reflect consensus positions within the Administration. We cannot confirm authorship of each, and it may be that some of the documents were authored by private sector entities. What we can say is that these are documents informing ongoing discussions within the Trump Administration.
- Regulation/Guidance Recommendations to Eliminate
This document highlights and makes recommended cuts and changes to premarket regulations, postmarketing regulations, compliance and monitoring, the Center for Medicare and Medicaid Services, the 340B program, and the U.S. Patent and Trademark Office.
- Potential Administrative Actions
This document includes a number of changes to FDA programs, lists, and processes. It includes a short list of legislative proposals currently proposed for the FDA.
- Generic Competition
This document recommends a number of reforms and incentives aimed at stopping price spikes on off-patent medicines with very few competitors.
It is notable, though not surprising, that none of these documents, nor the draft Executive Order recently published by Politico, includes policies championed by Trump on the campaign trail, such as prescription drug importation or allowing HHS to negotiate lower drug prices for Medicare Part D. We have analyzed several of the ideas proposed in the discussion documents:
Our analyses of the discussion documents' proposals:
- Generic Priority Review Vouchers are not the Answer to Price Gouging
One of the draft discussion documents is titled "Generic Competition", with a set of recommendations under the title "Incentivize entry of a first generic." Among the recommendations listed is one to create a transferrable voucher for priority review of any future generic drug application. These vouchers would have little, if any effect on lowering drug prices because their low value would provide minimal incentive for entering the generic market.
- 180-Day Generic Exclusivity Expansion Unlikely to Bring Down Prices; May Delay Price-Lowering Competition
The “Generic Competition” discussion document proposes the creation of a new 180-day marketing exclusivity period for the first eligible generic applicant for drugs without patent barriers or other exclusivities. This expansion of exclusivity is unlikely to bring down prices through competition, and further, the unintended consequences may actually delay competition for some prescription drugs, keeping prices higher for longer.
- Will Trump Adopt Pharma’s Proposals on Value-Based Pricing? Industry’s version of ‘paying for value’ raises red flags
Under the discussion document with the heading “Potential Administrative Actions”, one suggestion listed under the category “Rationalizing Reimbursement Policy” is to enable value-based purchasing arrangements with manufacturers. Value-based purchasing models vary in design, scope and impact, but prescription drug corporations historically have endorsed an outcomes-based approach to distract attention from more substantive reforms such as those included in the Improving Access to Affordable Prescription Drugs Act, as well as value-based pricing proposals that have potential to reduce spending in government programs. Our analysis argues that any Trump Administration ‘value-based pricing’ proposal is likely to mirror pharma’s proposals, and how those proposals fall short and raise concerns.
Leaked Drug Prices Executive Order
Big Pharma has captured the Trump Administration. The Donald Trump who promised to lower prices, ease Americans’ pain and take on the giant corporations is nowhere to be seen here. Instead, a draft Trump Executive Order on drug prices, formed in significant part by pharma lobbyist Joe Grogan, would increase profits at the expense of patient safety, while failing to reduce costs – and even potentially raising them.
Download: Leaked Executive Order: Reducing the Cost of Medical Products and Enhancing American Biomedical Innovation
- See our press release commenting on the New York Times' reported draft executive order.
What the Administration Should Do to Lower Drug Prices
There is nothing complicated about reducing drug prices, it just requires the will to take on the pharma lobby. Instead of the half-measures in the draft Order, the Trump Administration should:
- End monopolies. Allow competition. The government should authorize generic competition with high-price patented drugs as a means to reduce costs for public programs.
- Block backroom corporate deals that keep prices high. Federal agencies should litigate aggressively to prevent, stop and recoup ill-gotten gains of pay-for-delay deals and prevent anti-competitive mergers and acquisitions.
- Crack down on pharma fraud. Federal agencies must crack down on corporate crime, including routine pharma practices to overcharge the states, bribe healthcare providers, manipulate safety data and illegally market their products.
- Support meaningful legislative reform, including the Stop Price Gouging Act, introduced by U.S. Sens. Sherrod Brown (D-Ohio) and Kirsten Gillibrand (D-N.Y.) and Reps. Mark Pocan (D-Wisc) and Marcy Kaptur (D-Ohio), to end the price spiking of the EpiPen and opioid addiction treatments, and the Improving Access to Affordable Prescription Drugs Act, introduced by Sen, Al Franken (D-Minn) and Rep. Jan Schakowsky (D-Ill), with a wide range of drug pricing reform measures.
Reporting on Executive Order & Trump Agenda
Draft Order on Drug Prices Proposes Easing Regulations - New York Times
Exclusive: White House Task Force Echoes Pharma Proposals - Kaiser Health News
Peter Maybarduk, director of Public Citizen's Access to Medicines Program, talks about Trump's leaked Executive Order with CNBC TV18 in light of meetings with Indian prime minister Narendra Modi.