President Trump has stated that one of his greatest priorities is to reduce the price of prescription drugs. Alex Azar II, secretary of the Department of Health and Human Services (“HHS”), believes that while the United States’ system enabled it to become a world leader in the development of cutting edge drugs is also one that has not prioritized the needs of its own citizens.
On May 11, 2018 Trump directed his Administration to fix the injustice of high drug prices to ensure they come down, and unveiled his “blueprint” to put “American Patients First” though a 44 page document released on HHS’ website.
Pharmacy Benefit Managers (PBMs), previously largely unknown ‘middlemen’ in the U.S. pharmaceutical industry, whose impact on our healthcare system is just slowly beginning to emerge from the shadows, have been taking a lot of flak from independent pharmacy owners, politicians, and the media for being a cause of the high drug costs that the Trump Administration has vowed will be reduced.
President Trump has gone so far to say, of his Administration’s proposed American Patients First Blueprint, in his Rose Garden speech that “[w]e’re very much eliminating the middlemen” that “[t]he middlemen become very, very rich”, and that “[w]hoever these middlemen were – and a lot of people never even figured it out – they’re rich. They won’t be so rich anymore.”
As to whether President Trump’s words will ever come to fruition, the financial market and pharmaceutical lobbyist reactions to his remarks are perhaps telling.While investors were initially wary about the financial impact President Trump’s words could have prior to his Rose Garden speech, at the conclusion of his address the stock prices of America’s largest PBMs (Express Scripts and Caremark, respectively) increased two percent.
The Pharmaceutical Care Management Association (“PCMA”) is the national association representing America’s PBMs, including behemoths Express Scripts, Caremark and OptumRx. So what does it think about the Trump Administration’s blueprint to put American Patients First, which had seemingly targeted their operations? Forbes reports that the PCMA responded with a statement that included the following: “[w]e support (the administration’s) call for greater flexibility in benefit design to encourage better price negotiations, including allowing Medicare D plan sponsors to promote lower cost generics and biosimilars.”
President Trump’s proposal identifies a very real issue in our country and sets forth general ideas in how to rectify it. However, until its acted upon, implemented, and executed, it remains just that – a proposal. Only time will tell as to whether the President’s call to his administration to propose new action steps for increased competition and incentives will actually result in what is so greatly needed – reduced healthcare costs for Americans.