Trump Officially Backed Out of His Own Plan to Make Drugs Cheaper

He promised during the campaign to fight high drug prices, but turned away from those promises in a speech on Friday.
May 11, 2018, 10:02pm
Photo by NICHOLAS KAMM/AFP/Getty Images

Earlier this week, the White House quietly acknowledged what was already pretty clear: Congress isn't going to pass any kind of infrastructure bill this year. After all of Donald Trump's vague promises to rebuild America's roads, bridges and airports—and after his administration released a half-baked, unpopular plan—he apparently decided that unlike tax cuts for the wealthy and mass deportations, infrastructure spending was a priority he could abandon.


On Friday, Trump moved the goalposts on another one of his key promises: drug prices.

Under current law, the government can't negotiate directly prices for prescription drugs it provides as part of Medicare, the healthcare benefit for older Americans. Democrats have long held that this prohibition on negotiating—a practice that is commonplace in other Western countries—is one of the things keeping drug prices higher in the US than elsewhere. (Estimates from the nonpartisan Congressional Budget Office hold that such negotiations by themselves won't save much money unless coupled with other policy changes.)

One of the ways Trump surprised observers in the 2016 campaign was by embracing the Democratic idea that Medicare should negotiate drug prices directly. After his election, people were wondering if he'd follow through on promises to drive healthcare costs down by, for instance, allowing American consumers to buy drugs from other countries—a move that could have had implications for millions of patients, not just those on Medicare. A Bernie Sanders–led bill to allow that sort of importation failed in January 2017 after attracting a surprising amount of Republican support—but enough Democratic opposition to block it (Cory Booker, who voted no, said he was worried about patient safety). Afterward, there was speculation that Trump really would take a hard line on the issue and get into a major battle with big pharma.


Instead, just after taking office, Trump took a meeting with drug manufacturers and abruptly changed his tune—actually, the problem was high taxes and regulation, he decided. Since then, the president has done very little about drug prices, even though it's a major concern for a lot of Americans and something he spent a lot of time talking about on the campaign trail.

Now the administration is coming back to the issue, sort of. In a Friday Rose Garden address, Trump outlined a plan that, to be fair to him, actually did include things experts said would help. From the New York Times:

Mr. Trump’s “blueprint to lower drug prices” has four main themes: increasing competition in drug markets; giving private plans more tools to negotiate discounts for Medicare beneficiaries; providing new incentives for drug manufacturers to reduce list prices; and cutting consumers’ out-of-pocket costs.

The administration would lower out-of-pocket costs for Medicare patients by requiring prescription drug plans to pass on some of the discounts and rebates they receive from drug manufacturers. Patients could see savings at the pharmacy counter. At the same time, Medicare officials say, there could be a modest increase in premiums for Medicare drug coverage.

That stuff seems like common sense, as does Trump's promise to get rid of the "gag orders" that, fucking unbelievably, prohibit pharmacists from telling people that they could save money by paying cash for some prescription medications. (This is one of the many, many aspects of America's healthcare system that is both outrageous and completely commonplace.)

Less common-sensical is Trump's plan to end "global freeloading," by which he means getting drug companies to raise prices in other countries, which would then (under Trump's logic) let them lower prices in the US. (This is an echo of the common argument that US patients pay prices that help American companies develop new drugs, which other countries then reap the benefits of without paying their fair share of the costs.) But while the administration's push for higher drugs was music to big pharma's ears, it may not actually lower costs for US patients.

Just as he did on infrastructure, Trump began his political career making bold, populist promises that sounded good to a lot of people. Who would say no to more affordable medicine and better roads? In the second year of his presidency, he's backed off of those promises—either because he didn't mean them in the first place, or because follow-through would have been too difficult. Instead, he's embraced the path of least resistance, backing only reforms that big business is fine with.

Before his Friday speech, pharma companies were reportedly worried that Trump would go after drug prices in a serious way. After the speech, pharma stocks spiked in celebration.

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