Tag Archives for PhRMA

Ahead of Midterms, Trump Unveils His Proposal to Slash Prescription Drug Costs

Published in Woonsocket Call on October 28, 2018

With mid-term elections looming, President Trump moves to block Democrats tying the high cost of prescription drugs to an unresponsive Republican-controlled Congress and to GOP efforts to undo health care protections for people with preexisting medical conditions, one of the most popular provisions of the Affordable Care Act, referred to as Obamacare.

According to recent Roll Call poll, health care is a top issue for Democratic and Independent voters in key battle ground states while the GOP tout’s immigration and the economy and jobs as its priority.

Last Thursday, afternoon, at the Department of Health and Human Services (HHS) with Secretary Alex Aza, FDA Commissioner Scott Gottlieb and CMS Administrator Seem Verman standing by President Trump, he announced major changes as to how Medicare pays for prescription drug to bring down costs by making prescribed medications more affordable to seniors, making pricing of U.S. drugs fairer relative to costs paid by other countries.

Bringing Down Medicare’s Skyrocketing Drug Costs

“We’re taking aim at the global freeloading that forces American consumers to subsidize lower prices in foreign countries through higher prices in our country,” said Trump at the Oct. 25 press conference in his 14-minute speech. He noted that the costs for the same pharmaceutical drug in some countries are 20 percent less than those purchased in the United States even though it was made by the same manufacturing company.

“At long last, the drug companies and foreign countries will be held accountable for how they rigged the system against American consumers,” says Trump.

Trump rattled off specific examples of how Medicare pays higher prices for the same pharmaceutical drugs that are cheaper in other developed countries. For instance, one eye medication that prevents blindness would annually cost about $187 million rather than $1 billion dollars if Medicare paid the same prices other countries pay, he said.

Another example, a highly used and very effective cancer drug is nearly seven times as expensive for Medicare as it is for other countries, said Trump, noting that “this happens because the government pays whatever price the drug companies set without any negotiation whatsoever.”

Under Trump’s unveiled proposal, a new Medicare model, the International Pricing Index (IPI), is created to bring down Medicare drug costs to ensure seniors get a “more fair deal on the discounts drug companies voluntarily give to other countries.”

Currently, Medicare sets payments for physician-administered drugs at the average sales price in the U.S. market—plus a price-based add-on fee. Trump’s proposal would allow Medicare to set the payment of these drugs at a Target Price, based on the discounts drug companies give other countries. With the model fully implemented, it is estimated that total payment for these drugs would drop by 30 percent.

Under the IPI model, described in an Advance Notice of Proposed Rulemaking, Medicare’s payments for select physician-administered drugs would shift to a level more closely aligned with prices in other countries. Overall savings for American taxpayers and patients is projected to total $17.2 billion, with out-of-pocket savings potentially totaling $3.4 billion over five years.

Medicare beneficiaries not covered by the IPI model could also see their drug costs lowered, because the average price used to calculate traditional Medicare reimbursement will drop.

Trump’s drug pricing proposal still needs to be refined and put though a federal rule-making process and its impact may not be seen for years.

Is Trump’s Efforts to Lower Drug Costs Just Election Year Posturing?

“It’s hard to take the Trump administration and Republicans seriously about reducing health care costs for seniors two weeks before the election when they have repeatedly advocated for and implemented policies that strip away protections for people with pre-existing conditions and lead to increased health care costs for millions of Americans,” says U.S. Senate Minority Leader Chuck E. Schumer in a statement.

“Once again, the President’s plan doesn’t go far enough to bring down the costs of prescription drugs. Democrats have proposed letting the HHS Secretary negotiate the prices of all drugs covered under Medicare, as well as new tools to ensure transparency and accountability when companies try to raise their prices. Without these critical steps, the President’s plan is just more words with little substance,” says Rhode Island Congressman David N. Cicilline.

Pharmaceutical Research and Manufacturers of America (PhRMA) president and CEO Stephen J. Ubl, opposes Trump’s proposal to lower Medicare’s drug costs, warning that it would “jeopardize access to medicines for seniors and patients with disabilities living with devastating conditions such as cancer, rheumatoid arthritis and other autoimmune diseases.” Trump’s proposal severely alters the Medicare Part B program by reducing physician reimbursement and inserting middlemen between patients and their physicians,” charges Ubl.

Adds, Frederick Isasi, executive director of Families USA, in his statement: “The data is clear. The way we currently pay providers and pharmaceutical companies for drugs administered in doctors’ offices and hospitals creates perverse financial incentives for providers to select extraordinarily expensive drugs that may not be best for their patients. “

“Medicare Part B is the perfect example of misaligned incentives, and the proposed rule, if implemented, could pilot significant new ways to pay for drugs that align incentives so that patients get the highest value care, they have the best outcomes possible, and costs come down, says Isasi.

Like many, Isasi hopes that Trump’s proposal of using the power of the federal government to reduce Medicare drug costs is “not just election year posturing” but truly reflects a policy shift to using federal negotiating power to get unstainable prescription drug prices under control.

Next year, after the dust settles after the mid-term elections, Congress must work together to hammer out a comprehensive legislative strategy to lower pharmaceutical drug costs and to provide health care to all Americans. Listen to the polls.

Drug Company CEOs Receive Plea  for Lower Drug Costs

Published in Pawtucket Times on March 15, 2004

Seniors can only hope the pen is mightier than the sword as senior advocates send correspondence to CEOs of major drug companies, urging them to take more responsibility in putting the brakes on skyrocketing pharmaceutical drug costs.

Last Monday, AARP CEO William D. Novelli drafted a letter challenging 16 CEOs of major drug companies to lower the nation’s spiraling drug costs.

AARP’s CEO charged in this correspondence -which has been obtained by All About Seniors – that even with last year’s newly enacted Medicare prescription drug law, high drug prices are still a very serious issue for the nation’s seniors.

“Too many people cannot afford the drugs they need,” Novellis said, resulting in a “very substantial non-compliance with physicians’ recommendations.

Also contributing to higher drug prices, said AARP’s top official, is that seniors do not use geriatrics despite their “comparable effectiveness and lower cost.”

Novelli called on each drug company CEO to limit their company’s price increases to no greater than the level of inflation for current drug products. Additionally, he requested they stop price increases of new drugs, asking them to use their influence to stop drug mark-ups throughout the drug distribution chain.

Novelli urged the drug company CEOs to support drug-importation legislation, subject to proper FDA oversight to ensure safety of the imported medications. (Currently there is legislation being considered by Rhode Island lawmakers to allow drug importation from Canada).

Furthermore, Novelli asked CEOs for their drug companies’ strong endorsement of federal and state funding “to support clinically based, comparative effectiveness research that will permit objective, scientific comparisons of specific drugs in the same therapeutic class.”

Novell even urged the CEOs not to oppose any federal legislation introduced that would provide the Secretary of Health and Human Services with appropriate negotiating authority in the event the competitive private purchasing system does not produce the anticipated cost savings for the Medicare program.

The Republican-crafted Medicare law does not allow the federal government to negotiate for lower drug prices – a move that’s been opposed by the Democrats.

To put the brakes on rising out-of-pocket costs for seniors, Novelli also asked the CEOs to support a disclosure of pricing information by pharmaceutical benefits managers to their payer clients. This would assure that those enrolled in the Medicare program will receive full advantage of negotiated discounts and rebates.

Better displays of drug information regarding the risks, side effects and proven effectiveness of their consumer advertising is needed, Novelli told the CEOs. He also called for generics to be quickly moved into the marketplace when the patent has expired for brand name drugs.

In his correspondence, Novelli called on the CEOs to follow the ethics guidelines of the American Medical Association when it comes to giving gifts to physicians and sponsorships of educational meetings.

Last month, Lt. Gov. Charles J. Fogarty, chairman of the state’s Long-Term Care Coordinating Council, in Feb. 19 correspondence, called on Alan F. Holmer, president and CEO of PhRMA, to join the lead of drug manufacturer Merck in providing medication at no cost to low-income Medicare beneficiaries who participate in the new federal Medicare prescription drug discount card program.

Low-income seniors would be eligible for the Merck benefit once they use up their $ 600 federal allotment on their cards. Fogarty said in his written statement.

The Medicare drug discount cards are an interim measure put in place by the federal government until 2006, when newly passed Medicare changes will take affect, said Fogarty. The lieutenant governor, along with many of the state’s senior advocacy groups and the state’s Congressional delegation, have given their thumbs-down to the Republican-backed enacted Medicare revisions and have urged Congress to scrap the law and “to back to the drawing table.”

By accepting his invitation to help lower the cost of pharmaceutical rugs, Fogarty believes, “This will give the industry the opportunity to partner with the government and make a significant difference for those in need.”

The seniors’ battle to slash the out-of-pocket costs of pharmaceuticals must take place both on Capitol Hill, inside the Washington, D.C. Beltway, and at the Rhode Island Statehouse in Providence.  Novelli and Fogarty are now taking the fight to the boardrooms of major drug manufacturers across the nation.

Seniors may well hope that the pen is indeed mightier than the corporate sword.