{UAH} THE AMERICA FIRST HEALTHCARE PLAN

Trump picks fight with drugmakers with last-minute drug pricing rules

by Cassidy Morrison, Healthcare Reporter

 

November 20, 2020 03:05 PM

The Trump administration issued two final rules Friday aimed at lowering prescription drug costs, seeking to advance President Trump's “America First Healthcare Plan” and picking a fight with drugmakers two months before the end of his term.

The regulatory effort is notable in that it brings the Republican Party into open conflict with the pharmaceutical industry and is one of the few Trump initiatives that could be solidified under President-election Joe Biden.

"I hope they keep it because the powerful drug lobby, PhRMA, is putting pressure on people like you wouldn't believe," Trump said at a press conference Friday, apparently referring to the incoming Biden administration. Trump maintains that he won the presidential election.

Trump added, "I think it’s probably the biggest story we’ve ever had, relative to drug prices."

The final rules issued Friday implement Trump’s flurry of executive orders signed in July that were meant to lower the cost of prescription drugs for seniors.

The first rule finalized on Friday implements a mandate that pharmaceutical companies tie prices of the 50 most expensive prescription drugs sold to Medicare Part B, the benefit that covers drugs for outpatient care, to prices in other countries. The model is called the international drug-pricing index or the "Most Favored Nations" clause.

Friday's finalized rule has a narrower reach than the order that Trump announced over the summer, which would have extended the favored nations policy to the prescription drugs sold under Medicare Part D, the plan that covers the costs of the medications that seniors purchase at their local pharmacies.

The pharmaceutical industry has already warned the Trump administration that it will seek legal action to reverse the rules. The Pharmaceutical Research and Manufacturers of America, a trade group representing large pharmaceutical companies, argues that the rule gives too much control over access to life-saving medication to foreign governments. The group also says that forcing manufacturers to lower drug prices would ultimately stifle research and innovation efforts.

“We cannot speculate on what action the administration may take, but PhRMA continues to oppose the dangerous Most Favored Nation executive order that would allow foreign governments to arbitrarily decide what medicines are worth in the United States and what diseases are worth investing in,” a PhRMA spokesperson told the Washington Examiner on Friday.

Similarly, U.S. Chamber of Commerce Executive Vice President Neil Bradley said the final rule "would implement harmful price controls, which could jeopardize access to new life saving medicines at time when we need them most."

“Price controls would duplicate the failed policy of countries with limited domestic capacity for innovation," Bradley said in a statement. "We urge the administration to reconsider its approach, and the U.S. Chamber is assessing options to challenge this flawed policy.”

In September, PhRMA CEO Stephen Ubl called the rule “irresponsible and unworkable” in September, adding that it gives foreign governments “a say in how America provides access to treatments and cures for seniors.”

The other rule requires pharmacy benefit managers in Medicare Part D to pass discounts negotiated with insurers directly to the patients using those drugs, allowing Medicare beneficiaries to save money on their prescriptions.

The Most Favored Nation model goes into effect on Jan. 1, 2021, while the rule to eliminate PBMs and pass rebates on to seniors goes into effect on Jan. 1, 2022.

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