Trump turns to industry titan Azar to lower drug prices

Trump turns to industry titan Azar to lower drug prices
May 17 16:50 2018 Print This Article

President Donald Trump rolled out his American Patients First initiative to reduce prescription drug prices last week. The initiative will be overseen by newly installed Secretary of Health and Human Services (HHS) Alex Azar, a former top executive with pharmaceutical giant Eli Lilly.

Trump said from the White House, “One of my greatest priorities is to reduce the cost of prescription drugs. In many other countries, these same drugs cost far less than in the U.S. That is why I have directed my Administration to make fixing the injustice of high drug prices one of our top priorities. Prices will come down.”

One of the Trump Administration strategies is to use federal bargaining power to reduce the prices of medication paid for by Medicare, Medicaid, the Veterans Administration, and other government programs. Medicare and Medicaid spend more than $130 Billion a year on prescription drugs. HHS will update its drug price dashboards to provide greater transparency.

Azar said that Pharmacy Benefit Managers (PBMs), “middleman” companies which negotiate drug prices with insurance companies and large employers, are squeezing consumers with their business practices. He wants to restructure contracting rules so they can’t receive payments from the pharmaceutical companies. Azar also wants to end a PBM “gag rule” which forbids pharmacists from telling patients that they can save money on their medications by paying for them directly rather than going through insurance policies.

Some other policies being explored are requiring pharmaceutical companies to disclose their prices in drug advertisements and speeding up the Food and Drug Administration (FDA) approval process for generic drugs. That is already taking place, with more than 1000 generic drugs being approved in 2017, a record high.

Skeptics question how a former drug executive can be trusted to lower prices. Azar responded by stating, “I know the tired talking points – the idea that if one penny disappears from pharma profit margins, American innovation will grind to a halt. I’m not interested in hearing those talking points anymore.”

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