The Trump administration is “scrambling” to finalize an international price index for prescription drugs ahead of the State of the Union on February 4th, reports POLITICO—despite the fact Trump’s own economic advisers said a similar proposal would make us miss out on as many as 100 new cures.
Some context: In 2018, the administration proposed a “new Medicare model” to “bring down drug prices and cut down on foreign freeriding”—yeah, we think they meant “freeloading”—by setting drug prices based on other countries pay.
And now: POTUS reportedly had an “outburst” at HHS Secretary Alex Azar “over not getting credit for tackling drug costs,” explains POLITICO, so they’re trying to finalize the plan—though others in the White House wanted to keep the plan “for leverage” as Congress works on their own drug pricing bills.
If the administration does issue the rule, it “could give Trump a talking point for the State of the Union but would almost certainly trigger immediate legal challenges from the drug industry, which argues the plan exceeds the authority Congress gave to test new payment systems when it passed Obamacare,” says POLITICO.
And not only that: An international price index will not only chill investment in the industry and jeopardize new cures in the pipeline—something already happening due to the mere specter of price controls—but also won’t help patients better afford their medicines at the pharmacy counter because it doesn’t address the real drivers of health care costs, like hospital and physician services.
Jim’s Judgment: “Contrary to the president’s repeated promises to end ‘foreign free-loading,’ this proposal embraces it and exacerbates its harmful effects. By adopting foreign price controls on the very small number of innovative medicines that make it to market, this proposal will severely chill investment in new cures and therapies for America’s seniors,” said BIO CEO Jim Greenwood.
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