Published: Sun, October 28, 2018
Medical | By Johnnie Horton

Trump says proposal will lower US drug prices

Trump says proposal will lower US drug prices

This comes less than two weeks before midterm elections.

Another limitation, she said, is that it only affects a particular slice of Medicare beneficiaries whose drugs are covered under Part B, which related to medicines administered in a clinical setting.

Pharmaceutical manufacturers charge 1.8 times more in the United States than in other countries for drugs that fall under Medicare Part B, which are also used to treat conditions such as multiple sclerosis and autoimmune disorders, according to a Health and Human Services Department report released earlier Thursday. Trump gave a speech on Thursday at the Department of Health and Human Services in which he laid out his approach. "It's unfair and it's ridiculous, and it's not going to happen any longer", Trump said during a May 15 speech on drug pricing.

"Same company. Same box". Typically, these medications are the ones administered by doctors in their offices, at hospitals or in outpatient clinics, not the ones consumers buy at a pharmacy and take at home.

Administration actions have yet to show major impact on the cost of prescription drugs.

In another twist, the plan is structured as an experiment through a Medicare innovation center empowered to seek savings by the Affordable Care Act.

"The administration is imposing foreign price controls from countries with socialized health care systems that deny their citizens access and discourage innovation".

Under the plan announced by HHS, Medicare payments for drugs administered in doctors' offices would gradually shift to a level based on global prices.

The United States does not directly negotiate drug prices with manufacturers and American consumers often pay the highest prices for drugs.

Drugmakers are sure to push back, arguing it would be tantamount to adopting price controls. "These proposals are to the detriment of American patients", PhRMA President and CEO Stephen J. Ubl said.

The Pharmaceutical Research and Manufacturers of America (PhRMA), a major lobbying group, is crying foul, saying the proposal will upend a competitive and innovative marketplace in the USA, where patients get access to cutting-edge drugs faster than other developed countries.

Drug pricing expert Peter Bach of Memorial Sloan Kettering's Center for Health Policy and Outcomes called the plan "a pretty substantive proposal" but one that faces "serious political challenges". The government health insurance program for the elderly and disabled covers more than 40 million Americans. But that's "quite literally the opposite of what is being proposed".

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"We don't negotiate because we don't use the threat of walking away and other countries do", said Rachel Sachs, an associate professor of law at Washington University.

Democratic leaders on Capitol Hill were dismissive.

Unsurprisingly, the plan was met with immediate opposition from the pharmaceutical and biotech industries, which attacked the proposed changes to Part B as importing "foreign price controls". Senate Democratic Leader Chuck Schumer of NY said "it's hard to take the Trump administration and Republicans seriously about reducing health care costs for seniors two weeks before the election".

But PhRMA, the drug industry's main trade group, came out strongly against Thursday's proposal.

HHS Secretary Alex Azar criticized a system in which other countries to pay significantly less for drugs than the US government.

Trump's announcement on drug prices came hours after HHS released a report highlighting the steep spending by the US government on prescription drugs. And Azar also announced a proposal requiring manufacturers to include the list price of any drug paid for by Medicare or Medicaid in television ads.

The 19-page report looks specifically at drugs purchased and dispensed by doctors themselves under Medicare's Part B program.

Physician-administered drugs cost Medicare $27 billion in 2016.

The HHS said the plan would save American taxpayers and patients $17.2 billion and would cause total payment for the affected drugs to drop by 30 percent. It could pay them a flat fee, instead of the current system of providing a percentage of the medication's cost. However, HHS officials said the plan is designed so it would not cut into doctors' reimbursements.

The administration said it did not plan to propose the rule until next spring, and would begin implementing it in 2020 over a five-year period.

Trump's remarks were the first as president at HHS and come at a time when health care is playing a defining role in midterm campaigns, with Democrats slamming Republicans over whether they support protecting access to health care for people with preexisting conditions.

Trump has harshly criticized the pharmaceutical industry, once asserting that the companies were "getting away with murder", a comment that sent pharmaceutical stocks tumbling.

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