Liberal lawmakers challenge Trump with drug cost legislation – By Ricardo Alonso-Zaldivar (associated press) / Jan 11 2019
WASHINGTON — Challenging the Trump administration on a top consumer issue, leading congressional liberals are proposing legislation that would radically reduce U.S. prescription drug bills by linking prices to lower costs in other countries.
The legislation set to be introduced Thursday has little chance of becoming law under a divided government. But it could put Republicans on the defensive by echoing themes and ideas that President Donald Trump has embraced at one time or another. The common denominator is that people in the United States shouldn’t have to pay more for critical medications than do people in other economically advanced countries.
The Trump administration has put forward its own plan for reducing drug prices, but industry analysts have seen little impact so far.
The new legislation was coming from Sen. Bernie Sanders, I-Vt., and Rep. Elijah Cummings, D-Md. Cummings leads the House Oversight and Government Reform Committee, which is expected to take a major role on drug pricing issues.
The lawmakers want to:
- Open up generic competition to patent-protected U.S. brand-name drugs that are deemed “excessively priced.”
- Allow Medicare to directly negotiate with drugmakers.
- Let consumers import lower-priced medications from Canada.
“It’s time to provide much-needed relief to the American people,” Cummings said in a statement. “No more talk. No more tweets. The American people want action.”
Added Sanders: “If the pharmaceutical industry will not end its greed … then we will end it for them.”
Under their plan, the Health and Human Services Department would get a major new mission regulating drug prices.
Trump, as a presidential candidate, initially called for Medicare to negotiate drug prices and he favored allowing people to import lower-priced medications from abroad, something that many consumers already do even if it is not legal.
But Medicare negotiation is a political nonstarter for most Republicans, who favor a free-market approach to the U.S. pharmaceutical industry and prize its capacity for innovation.
As president, Trump has come out with a plan to lower drug costs that relies on dozens of regulatory actions. A main goal is to eliminate incentives for drugmakers, pharmacy benefit managers and insurers to stifle competition at the expense of consumers. Independent experts say the administration’s proposals would have an impact, but not limit the ability of drug companies to set high prices.
Time and again, Trump has complained that other countries where governments set drug prices are taking advantage of Americans. Indeed, one of his ideas would shift Medicare payments for drugs administered in doctors’ offices to a level based on international prices.
“We are taking aim at the global freeloading that forces American consumers to subsidize lower prices in foreign countries through higher prices in our country,” the president said when he made that proposal shortly before last year’s congressional elections.
The Democratic bills would go far beyond Trump’s approach.
The newest idea would essentially apply to any U.S. patent-protected brand-name drug, whether or not government programs are bearing the cost. By comparison, Trump’s international pricing proposal would not apply to retail pharmacy drugs purchased by Medicare beneficiaries or to medications for privately insured people. It’s the result of a joint effort between Sanders and Rep. Ro Khanna, D-Calif.
Drugs found to be “excessively priced” by the government could face generic competition. A medication’s cost would be deemed “excessive” if its price in the U.S. was higher than the median, or midpoint, price in Canada, the United Kingdom, Germany, France and Japan.
If the manufacturer was unwilling to cut its U.S. price, then the government could allow generic companies to make a more affordable version of the medication. Generic drugmakers would have to pay “reasonable” royalties to the company holding the patent.
The pharmaceutical industry is already adamantly opposed to Trump’s international pricing idea and is likely to fight the lawmakers’ proposal even harder.
