Trump unveils most aggressive action to target drug prices

President Trump on Thursday announced a proposal to base payments for certain drugs off of lower prices in other countries, his most aggressive move to lower drug prices in the U.S.

The proposal more aggressively moves to have the government intervene to lower drug prices than proposals often favored by Republicans.

“Same company, same box, same pill, made in the exact same location,” Trump said in a speech at the Department of Health and Human Services (HHS). “And you go to some countries and it would be 20 percent of what we pay.”

“We’re fixing it,” he added.{mosads}

The announcement comes less than two weeks ahead of the midterm elections, where Republicans have been on the defensive on health care for their votes to repeal ObamaCare and weaken pre-existing condition protections.

The proposed regulation would set up an “international pricing index” that would be used as a reference to set prices paid for drugs paid for through Medicare Part B, the section of Medicare that covers drugs administered in a doctor’s office.

Thursday’s move does not deal with drugs dispensed at a pharmacy counter.

Medicare Part B has been criticized for paying too much for drugs. Former President Obama proposed a different way to lower prices there but dropped the proposal amid sharp industry opposition.

Democrats on Thursday immediately sought to pivot back to the issue of pre-existing conditions. 

“The plan President Trump unveiled today likely won’t result in lower prescription prices for seniors, and it may even increase drug costs for some Medicare beneficiaries,” said Rep. Richard Neal (D-Mass.), the top Democrat on the Ways and Means Committee.

“The GOP’s lack of effective strategy to bring down prescription prices goes hand in hand with the party’s relentless efforts to eliminate pre-existing condition protections and slash funding for Medicare, Medicaid, and Social Security.”

Democrats have called for more to be done, such as having Medicare negotiate drug prices, a move Trump previously supported during his presidential campaign.

“We really think it can be bipartisan,” Trump said of his new plan.

The proposal does not require action from Congress, but is instead a step forward on administrative action.

The president said it was a “Democrat who told me how important drug pricing was.”

If Democrats retake the House in next month’s elections, drug pricing is seen as a possible area of cooperation between the party and Trump.

“When [people] see their drug prices falling, they’re going to say, ‘What’s happened, they must have made a mistake,'” Trump said Thursday.

Trump also said he supported protections for people with pre-existing conditions, which he has previously said Republicans support in light of criticism of votes to repeal ObamaCare. 

“We will always protect Americans with pre-existing conditions,” he said.

The pharmaceutical industry came out swinging against the new proposal.

“The administration is imposing foreign price controls from countries with socialized health care systems that deny their citizens access and discourage innovation,” said Steve Ubl, CEO of the Pharmaceutical Research and Manufacturers of America. “These proposals are to the detriment of American patients.”

Asked about possible concerns from congressional Republicans, who could object that the proposal goes farther towards price-setting than the GOP is usually comfortable with, Secretary of Health and Human Services Alex Azar confirmed that he did not give a heads up to lawmakers. “We did not pre-socialize the idea,” he said.

Instead, he said the current system in Medicare Part B, where the government pays essentially whatever price the drug company sets, is so costly and broken that the need to fix it is urgent.

“That is not tenable. That has to change,” Azar said.

Despite the reaction from Democrats that the moves is woefully inadequate, Trump expressed hope for their support.

Rep. Peter Welch (D-Vt.), a leading advocate of fighting high drug prices, noted Thursday that the move would only apply to the segment of drugs administered in doctors offices and paid for by Medicare. He called for bolder action affecting all drugs. 

“It’s a small step when we need a giant leap ahead,” Welch said.