Trump administration releases four new executive orders, intending to reduce drug costs, before the November election

By Tom Brockbank, Senior Consultant, Pricing & Market Access

Trump announced on Friday 24th July, a one-month ultimatum for drug manufacturers to offer alternative plans to reduce drug prices. This will provide manufacturers an alternative option to the stalled plan to reference drug prices in foreign markets, as a way of capping the prices in the US. Although the White House has not yet released the text around its international pricing rule, it did clarify it will apply the Medicare Part B drugs; those administered in doctor’s offices or hospitals. Medicare will not pay more than any “economically comparable” country in the Organisation for Economic Co-operation and Development (OECD).

The second order, should it come into effect, would eliminate the rebates paid by drug makers to insurers. However, this order would only be implemented if there would be no increase to premiums to compensate. With the government’s own actuaries estimating there would be an increase to up to 25% in premiums, it is still unclear whether this order will be put into action.

The third order will ensure more freedom is being provided to Americans in terms of importing medicines from other countries. The new order says HHS will facilitate grants to individual consumers allowing them to import prescription drugs.

The final order would enforce that certain health centres to pass negotiated discounts on insulin and EpiPens to patients.

A group of pharmaceutical executives will be attending a meeting at the White House to discuss potential alternatives to Trump’s proposals, particularly the international pricing scheme. What will it mean for the future of drug pricing in the US, should they begin International Reference Pricing? Could we begin to see prices increase in Europe and Rest of World to compensate and ensure manufactures are still able to get a return on investment (ROI)? What reference rules are going to be applied and which markets will be in the US’s reference basket?

GPI’s extensive platform, GPI PulseTM, stores policy, pricing, reimbursement, IRP matrix, and regulatory data in more than 96 countries. If you would like to know how to keep track of all the latest policy and P&R changes, please get in touch to find out more at info@globalpricing.com

About GPI

We are leading the way forward with analytical and platform driven price and access solutions – to a future where reliable data insights empower confident strategic decision-making and drive meaningful change in the life sciences market. ​

Quick access to quality insights is the key to understanding global payer needs and setting the right prices at pace. And, when it comes to getting therapies to patients fast, consistently accurate insights are critical. ​

GPI pulse and GPI HORIZON, supported by experienced consultants use robust validated methodology to provide high quality, curated insights on global prices, market access decisions, asset evaluation, value perception and payer behaviour.  ​

We provide an agile, data-driven, and future-focused perspective to pricing and market access. As your innovation partner, we will help you make the most of your insights to build strategies, optimise operations and identify market opportunities. With the right tools, insights, and know-how, you will make confident decisions to power the future of your business and shape the evolving biopharma landscape.

GPI. Making market access more efficient.

Bibliography

U.S. Department of Health & Human Services, 2020. Trump Administration Announces Historic Action To Lower Drug Prices For Americans. [online] Available at: <https://www.hhs.gov/about/news/2020/07/24/trump-administration-announces-historic-action-lower-drug-prices-americans.html> [Accessed 28 July 2020].

Florko, N. and Facher, L., 2020. Trump Administration Unveils Executive Orders To Curb Drug Prices — But They Come With Caveats. [online] STATnews. Available at: <https://www.statnews.com/2020/07/24/trump-executive-orders-drug-pricing-election/> [Accessed 28 July 2020].