Article Summary:
The Trump administration has signed an executive order aimed at lowering U.S. drug prices by allowing pharmaceutical companies to charge more for their products abroad. The order directs the Department of Health and Human Services (HHS) to set targets for drug price reductions in public and private U.S. health programs within 30 days, leading to negotiations between the government and the drug industry.
If sufficient progress is not made, HHS would implement a “Most Favored Nation” policy, using federal power to ensure the U.S. pays the same prices as other developed nations. The administration also plans to facilitate direct-to-consumer pharmaceutical sales at these lower prices, while directing trade and commerce officials to crack down on “unfair and discriminatory” foreign policies that keep prices lower abroad.
The goal is to force other countries to pay higher prices, thereby reducing the proportion of R&D costs borne by American consumers. The drug industry has criticized high U.S. prices but supports the administration’s efforts to get other nations to contribute more.
Meanwhile, the administration has attacked former Vice President Biden’s policy of allowing Medicare to negotiate drug prices, calling it a “failure.” It plans to continue the program with unspecified changes. Overall, the order represents an aggressive move to lower U.S. drug costs by shifting more of the burden to foreign markets, even if it means higher prices abroad.
Article Excerpt:
“To lower costs for Americans, we need to address the real reasons U.S. prices are higher: foreign countries not paying their fair share and middlemen driving up prices for U.S. patients,” Pharmaceutical Research and Manufacturers of America president Stephen Ubl said in a statement. “The Administration is right to use trade negotiations to force foreign governments to pay their fair share for medicines. U.S. patients should not foot the bill for global innovation.”