Trump’s Exec Order on drug pricing proves he’s like the leopard; he can’t change his spots

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A draft of President Donald Trump’s executive order on drug prices lists several proposals to lessen regulatory hurdles for the pharmaceutical industry, reports The New York Times.

@realDonaldTrump issues executive order to help lower #drugprices Click To Tweet

Here are four things to understand about the proposals.

  • Update global trade agreements. One proposal calls on the Office of the US Trade Representative to analyze global drug pricing differences and identify potential revisions to trade agreements “to promote greater intellectual property protection and competition in the global market,” according to the order.

 

  • Scale back 340B. The draft proposes scaling back the 340B drug pricing program, which ensures hospitals treating a large proportion of low-income patients can buy medications from drugmakers at a discounted price. The drug industry has long called for stricter oversight to prevent hospitals from abusing the program.

 

  • Push value-based drug pricing. Another proposal seeks to eliminate hurdles for value-based drug pricing, which entails paying drugmakers for a drug based on the medication’s success treating a specific patient or disease.

 

  • Limit out-of-pocket costs. One proposal seeks to fix “regulatory or administrative actions” that force Medicare patients to pay list price for drugs when pharmacy benefit managers achieve a lower price from the drug companies, according to the report. A second proposal focuses on regulations “that inappropriately or unfairly contribute to higher prices or cost-sharing for medical products for American patients,” the draft reads. (Ref: Becker’s Hospital Review)

Steve’s Take:

Let’s rewind the clock about six months. Recall when President Trump stood at a podium and excoriated the pharma industry with a resounding declaration that its executives are “getting away with murder”?

If Congress has its way, the same president will soon sign into law a massive package that is at the top of the industry’s wish list: a reauthorization of drugmakers’ funding agreements with the Food and Drug Administration, says STAT News.

If I didn’t know better (and I could definitely be simply uninformed), the pharma industry wrote the whole thing, it’s that favorable.

At least so far, the mighty industry has managed to keep the package that is speeding toward Trump’s desk free of any controversial policy changes that could threaten the industry’s business model–as well as any partisan add-ons that could jeopardize its smooth, overwhelmingly bipartisan trip through the policymaking process.

That progress is a testament to an often-overlooked truth in Washington these days: Despite frustration over high drug prices and partisan brawling over healthcare legislation, the pharmaceutical industry has been carrying on with business as usual, scoring some early legislative victories, and reminding lawmakers why it is one of the most influential groups on Capitol Hill.

At the same time, the executive order on drug prices being fashioned by the White House may prove far more beneficial to industry than Trump’s campaign oratory would have suggested, according to documents obtained by Kaiser Health News. The industry’s recent successes are the result in no small part of its astute and clever advocacy strategy–and, of course, the brute cash it puts into that endeavor.

The industry’s main trade group, the Pharmaceutical Research and Manufacturers of America, spent a stunning $7.9 million in just the first three months of this year–the most it has spent in a single quarter since 2008. That bought drugmakers a throng of more than 85 lobbyists both internally and at nearly two dozen outside firms.

Outside firms pay some of those PhRMA dues, but often spend more on their own efforts–the 10 largest pharmaceutical companies that lobby in the US together dropped more than $20 million in just the first three months of 2017.

That tally doesn’t include campaign donations.

The website OpenSecrets, maintained by the Center for Responsive Politics, estimates the industry rained down about $27.9 million upon candidates of both parties during the 2016 cycle. A spokeswoman for PhRMA declined to comment on the industry’s lobbying strategies or the user fees process, STAT notes.

The “user fee” reauthorization bill before Congress, which spells out how much branded and generic drug companies and medical device manufacturers pay to support their product reviews at the FDA, traditionally receives bipartisan backing.

The overwhelming bulk of the new package is hammered out between industry representatives, including generic and biosimilar companies, and the FDA itself, earning a blessing from both only after several years of work.

The legislation must still pass both chambers of Congress before it heads to Trump’s desk, and several congressional aides and lobbyists suggested those upcoming debates might prove more contentious.

Meanwhile back in the Capitol, two House Democrats who met with President Trump earlier this year to discuss prescription drug pricing slammed the president Wednesday for not making good on his promise to lower the high cost of such drugs.

In a letter to Trump, Reps. Elijah Cummings (D-MD) and Peter Welch (D-VT) criticized the president for doing nothing to help lower drug costs, according to The Hill.

Welch and Cummings met with Trump in the Oval Office in March to discuss legislation that would allow Medicare to negotiate directly with drug companies to lower prices, a policy Trump campaigned on. The lawmakers said they left that meeting feeling hopeful that the president would embrace their legislation.

But since that meeting, “we have heard nothing more from you” or Health and Human Services Secretary Tom Price, the lawmakers wrote. They said if the reports about the executive order are true, “this would be a betrayal of the very people who supported you and rely on you to make good on your promises.”

The lawmakers called for Trump to intervene with the internal drug pricing working group and direct them to “embrace the aggressive reform desperately needed by Americans — which you promised in your campaign–rather than the steps they are reportedly considering at the behest of the pharmaceutical industry.”

Bottom Line:

It’s not as if ideas to resolve much of this aren’t circulating around Washington, and it’s not as if legislators don’t know the kinds of “dirty games drug companies are playing,” Business Insider argues.

Earlier this month, the Senate Committee on Health, Education, Labor, and Pensions held a panel on drug pricing and brought up an assortment of obvious issues that had become the center of the drug-pricing debate and, in some cases, Department of Justice investigations.

For example, it was made quite clear during the panel that research-and-development costs aren’t what are really contributing to high drug prices when it comes to big pharma. More money is spent on marketing drugs than on developing them.

To be fair, Business Insider notes, there is one minute measure in Trump’s draft executive order that seems to hint at helping: basically taking PBM rebates out of Medicare. Of course, it’s unclear how this order would tackle that, as there are no specifics and this would have to be legislated.

Business Insider concludes with this harsh indictment:

“Trump is not for his base; he’s not for anyone. He’s a corporatist, and he will continue letting corporations make decisions that his White House is either too lazy or too incompetent to make, to the detriment of Americans, whether they voted for him or not.”

Steve's Take: I'm hopeful @realDonaldTrump will turn things around and behave like a real leader Click To Tweet

Looking back to his press conference on January 11, when he blasted the pharma industry over its drug pricing conduct, I must confess I’m reminded of Act 5, Scene 5 of Macbeth, which reads in part: “Life’s but a walking shadow, a poor playerthat struts and frets his hour upon the stage and then is heard no more. It is a tale told by an idiot, full of sound and fury, signifying nothing.”

I regret that this seems apropos now, not even six months into his teetering tenure as our nation’s chief executive. I’m still hopeful President Trump will turn things around and begin behaving like the leader many of us still believe he can be.