Trump and pharma execs make nice; what, Sen. Sanders too?

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The News:

Last week (January 30, 2017), President Trump promised some of the nation’s top drug-company executives in a meeting at the White House that he would shrink Food and Drug Administration (FDA) regulations like never before and make it easier to produce products in the US.

@realDonaldTrump promises to shrink @FoodDrugAdmin regs to encourage faster drug approvals Click To Tweet

The New York Times reported he also described as “fantastic” the person he planned to nominate for FDA commissioner of–someone he said would streamline the agency and get drug approval decisions faster.

“You can’t get approval for the plant, and you can’t get approval for the drug; other than that, you’re doing fantastic,” Mr. Trump said at the meeting.

Trump’s comment drew laughter from top executives of companies like Merck & Co. (Whitehouse Station NJ), Johnson & Johnson (New Brunswick NJ), Eli Lilly & Co. (Indianapolis IN) and Novartis AG (Basel CHE).

But even as he struck a warm and apparently sincere tone, Trump said that lowering drug costs would remain a focus and that he would discuss the issue further during the nonpublic portion of the meeting, away from the news media.

“The US drug companies have produced extraordinary results for our country, but the pricing has been astronomical,” Mr. Trump said. “We have to get prices down for a lot of reasons.”

Raked over the coals by public outrage over the rising costs of drugs in recent years, the drug industry has regarded Mr. Trump warily in recent weeks, the Times notes. Pharmaceutical and biotechnology stocks rallied after his election as investors bet that Mr. Trump would reduce corporate taxes and adopt more industry-friendly policies than his Democratic opponent, Hillary Clinton, who had made reducing drug prices a campaign issue.

But that sanguinity gave way to unease after Trump pledged to confront the drug pricing issue himself, including raising the possibility of allowing Medicare to negotiate the prices of drugs directly, something the industry has long opposed.

Just a few weeks ago, Mr. Trump singled out the pharmaceutical industry for its high prices, accusing it of “getting away with murder,” Politico recalls. At last week’s meeting, Mr. Trump again referred to Medicare’s role, saying he would oppose anything that prevented competition, including

“price fixing by the biggest dog in the market, Medicare, which is what’s happening.”

A White House spokesman later clarified that his remarks meant that the president “supports increasing bidding and competition for all drugs in Medicare.” But the president also tried to persuade the executives that he would provide them with assistance, saying:

“We can save tens of billions of dollars, and you people are going to do great. You’re going to do great.”

In comments after the meeting, the drug industry leaders said it had been “productive” and said they welcomed the president’s pledges on cutting regulations and speeding approvals. But drug-safety advocates criticized his remarks, saying that eliminating agency regulations would mean rolling back consumer protections on products as diverse as drugs, cosmetics, food and dietary supplements.

On the other hand, “Trump’s horrifying proposal reflects utter ignorance about the FDA’s essential role in protecting public health and once again demonstrates his commitment to placing corporate profits above protecting the safety of the American people,” said Dr. Michael Carome, director of Public Citizen’s health research group.

Wall Street, however, reacted positively to Trump’s remarks as healthcare stocks had the biggest five-day, industry-specific gain with a 2.4% advance.

Steve’s Take:

Following Trump’s meeting last week with a rash of Big Pharma execs and the trade group PhRMA (Pharmaceutical Research and Manufacturers of America), the agitator senator, Bernie Sanders, (I-VT) said he’d be willing to help if the president is “serious about standing up to the pharmaceutical industry and reducing drug prices.”

According to FiercePharma, along with Rep. Elijah Cummings (D-MD), Sanders is working on legislation that would allow drug importation from countries such as Canada and Medicare price negotiations, the latter being a strategy the president recently endorsed.

Cummings has already had a chance to chat with Trump about drug pricing. The two talked the week prior by phone, after the Congressman made a direct appeal to the president on MSNBC’s Morning Joe.

“President, I know you’re watching, so I’m looking forward to meeting with you…,” Cummings said, as first reported by American Urban Radio Network. “Call me. I want to talk to you.”

According to the network, Trump then “picked up the phone and called Congressman Cummings. He called his Washington office, and the two spoke on the issue of prescription drugs.” The two had met on Inauguration Day and said then that they’d arrange a discussion, The Hill reported.

Sanders’ pledge of help came after Trump met with chief execs of Merck & Co., Novartis, Eli Lilly and other biopharmas, as well as leaders of the industry’s trade group PhRMA.

“You folks have done a terrific job over the years, but we have to get prices down for a lot of reasons,” Trump said at the meeting, according to remarks posted later in the day.

He said costs are “astronomical” in the US and later added that his administration is “going to get rid of a tremendous number of regulations” for pharma companies.

Sanders isn’t the only senator who’s on the record offering to lend a hand in the drug price fight. Sen. Amy Klobuchar (D-MN), who early on called for an investigation into Mylan’s EpiPen prices, recently wrote in an op-ed that she’s willing to work with Trump on the issue. To get started, she suggested several tactics that she said would quickly provide price relief. Among them are stepped-up Medicare negotiation powers and drug reimportation.

At the meeting last Tuesday, Trump provided other hints of his administration’s plans on drug pricing. The president said he wants to “streamline” the FDA and end “global freeloading” by countries that use price controls to limit their spending.

Bottom line:

Pharma chiefs came away from the meeting now saying that Trump’s proposals would speed growth and create new jobs. In an industry where the biggest companies have slashed payrolls by tens of thousands over the past several years, that would be quite a turnabout.

For one, industry group PhRMA’s CEO, Stephen Ubl, said afterward that changes to trade agreements and to the US corporate tax code, plus fewer regulations,

Mr Ubl says this “will translate to up to 350,000 new jobs over the next 10 years as a result of growth in the biopharmaceutical industry.”

And Eli Lilly CEO David Ricks said in an interview with CNBC that he was “most encouraged” that the president “clearly understood and was listening to the message of innovation.”

Ricks said Lilly is ready to “work with the White House and Capitol Hill over the coming months to look at some more market-based solutions to help consumers.”

The message strikes a contrast from last month, when Trump–then president-elect–scolded pharma during his first press conference since last summer. He said the US should implement “competitive bidding” on drugs to save billions in healthcare expenses, one of several statements that immediately bashed pharma stocks.

Steve's Take: Is @realDonaldTrump scolding or siding with Big Pharma? It's anyone's guess Click To Tweet

So what actually happened last week? Did the two sides–Big Pharma and Mr. Trump–really make nice-nice in the sense of being friendly and sincere, or was it more like being pleasant or polite to someone in a hypocritical way. Like when the seat next to you is empty, so you aren’t required to “make nice” with a stranger?

Stay tuned because we’re learning our president can be hard to fathom on any given day. Best to pick your seat at the White House briefing table with all due regard to who’s your neighbor.