May 23, 2018
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Trump promises sweeping drug price cuts, targets lobbyists, cheap overseas prices

By Lori Valigra
Updated:

Saying the drug lobby is making “an absolute fortune” on American consumers, President Donald Trump promised lower prices at the pharmacy counter soon in a speech Friday about his long-awaited plan to cut prescription drug prices.

“We are launching the most sweeping action in history to lower the price of prescription drugs for the American people,” he said.

The plan could offer some financial relief for the approximately 150,000 Mainers on Medicare, as well as other consumers at the pharmacy counter.

“Paying for the high cost of prescription medications puts a heavy burden on individuals already suffering financially. Today’s announcement from the Trump administration is a pivotal step toward ensuring that Americans have access to the medications they need, at an affordable price,” Maine Department of Health and Human Services spokeswoman Emily Spencer said in an email to the Bangor Daily News.

Before the announcement, industry experts said they expected the plan to have little impact on pharmaceutical companies. Trump had attacked prescription drug companies for high drug prices during his election campaign.

However, Trump did attack drug lobbyists, saying they spent more than any other industry last year, a total of $280 million.

“The drug lobby is making an absolute fortune at the expense of American consumers,” he said.

Gordon Smith, executive vice president of the Maine Medical Association, said he likes Trump’s proposals overall and noted that drug lobbyists, like the pharmaceutical industry, tend to support Republican candidates.

“I give him a lot of credit that he’s going after the lobbyists,” Smith said.

The largest U.S. drug industry lobby group, the Pharmaceutical Research and Manufacturers of America, alone spent $9.96 million on lobbying efforts from Jan. 1 to March 31 of this year, according to the U.S. Senate’s Office of Public Records database. That’s up almost $2 million from the $5.88 million in the last quarter of 2017.

The pharmaceutical companies have claimed drug prices are high because the costs to develop them are high. It takes about 10 years and costs about $2.56 billion to develop a drug and get it approved for marketing, according to the Tufts Center for the Study of Drug Development. That’s up 145 percent from an estimate the center made in 2003. Tufts cited higher clinical trial costs and higher failure rates for drugs tested in humans as two main reasons for skyrocketing drug development costs.

Trump said his plan would decrease regulatory burdens so drugs could get to market much quicker.

U.S. Department of Health and Human Services Secretary Alex Azar asked for more pricing transparency, saying when drug companies advertise on television, they also should include pricing information. He said the U.S. Food and Drug Administration would examine requiring pricing on ads.

“It’s a very good idea to put the drug cost on a television ad. It gives the patient more information in addition to the risks,” Smith said, noting that Sen. Angus King, I-Maine, has made a similar proposal. “The biggest barrier for patients is the cost, and it’s virtually impossible to find out what things cost with the middlemen involved.”

Other aspects of the plan include more private competition, including more approvals of generic drugs. Last year the FDA approved about 1,000 generic drugs, Trump said, saving Americans nearly $9 billion.

He also wants the “gag rule” lifted that prevents pharmacists from telling customers ways to get cheaper medications.

The Trump plan does not include his campaign promise to use the Medicare program’s buying power to directly negotiate with drugmakers for senior citizens. However, he proposed giving private health insurers that run Medicare plans more power to negotiate with drugmakers. He did not say how that would work.

That was disappointing to Smith of the Maine Medical Association. “It’s better than what we have now, but not as effective as the government doing a group purchase,” he said.

Consumers are ultimately going to be the judge of this announcement, Dan Mendelson, a health care consultant and CEO of Avalere Health in Washington, D.C., told the Associated Press. “If they don’t address the cost that patients see at the pharmacy counter it’s not going to be seen as responsive,” he said.

Some 149,329 Mainers had Medicare prescription drug plans in 2017, according to the Kaiser Foundation. Each of those Maine residences spent $9,325 for the year in 2014. The total number of Americans on Medicare tops 25 million.

The White House’s Council of Economic Advisers In February 2018 gave a glimpse of the president’s thinking in a published paper entitled “Reforming Biopharmaceutical Pricing at Home and Abroad.”

The paper quotes a study by Politico and Harvard University that found Americans considered prescription drug prices the top priority for Congress in 2017. It was the top priority for Democrats and independents, but came in third among Republicans, who ranked getting rid of the Affordable Care Act as their top priority followed by raising the federal minimum wage.

The paper cited drug costs using data from the America’s Health Insurance Plans advocacy group. Drugs to treat certain cancers can cost from $12,897 to $540,648 annually and those for eye disorders can run $13,320 to $29,256 per year.

Trump also is targeting foreign countries, which he says sell the same drugs from the same manufacturers for a few dollars compared with hundreds of dollars in the United States. He said U.S. Trade Representative Robert Lighthizer would work on equalizing the prices.

“It’s time to end the global freeloading,” Trump said, referring to the U.S. shouldering the financial burden of developing the drugs.

“These reforms are just beginning,” he said, adding that in the coming weeks he’d work with Congress to pass legislation to allow drug price reductions.

U.S. Sen. Susan Collins, R-Maine, chair of the Senate Aging Committee and a member of the Senate Health Committee, said the action by the Trump administration is encouraging.

In its own earlier effort to reduce prices, Maine passed a law in 2013 that allowed residents to buy prescription medication by mail from other countries. For decades, residents already had been driving to Canada to buy their medications to save money. The Canadian and other governments use their national health systems to cap prices on many prescription drugs, so they can sell them less expensively.

That law, the first of its kind in the nation, lasted only a couple of years before a federal judge struck it down in February 2015. Under federal law, importing drugs into the United States from other countries is illegal.

A group of U.S. lawmakers led by Vermont Sen. Bernie Sanders, including Maine Sen. King, introduced a bill in February 2017 that would allow prescription drugs to be imported from Canadian pharmacies if the medications meet certain safety standards.

That bill was introduced in the U.S. Senate and House last year and remains in the early legislative process. The Maine Pharmacy Association and other groups signed a letter to members of Congress opposing the legislation, saying imported drugs could be unsafe.

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