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Trump Offers Blueprint to Drive Down Prescription Drug Prices; Targets Rebates, "Middlemen"

Mary Caffrey
Out-of-pocket costs for consumers and targeting the complex pharmaceutical rebating system were the high points of a presentation that began in the Rose Garden and ended with HHS Secretary Alex Azar's details in the White House press room.
Verma’s statement “is not supported by any data,” said Ted Okon, MBA, executive director of the Community Oncology Association (COA), in an interview with The American Journal of Managed Care®. “It comes at a time when community oncology is doing so much to support payment reform.”

Okon said the administration’s chief concern should be the proposed mergers of CVS and Aetna, as well as Cigna and Express Scripts, which would cause higher prices through increased vertical integration in the healthcare system. “History has told us with greater consolidation you have higher costs,” he said. Despite promises of savings through better coordination, “that never happens.”

In a statement after the speech, a COA statement said the group was dismayed that the plan did not call for an end to the 2% sequester; in the 6 years since the sequester took effect, 135 cancer treatment centers have closed.

Widespread reaction. Reaction was diverse, from physicians to advocates for openness in prescriptions. The Alliance for Transparent and Affordable Prescriptions (ATAP) said, “ATAP is pleased that President Trump addressed the pharmacy benefit manager (PBM) problem, and the rebate system specifically, in his speech today on drug prices. For far too long these invisible middlemen have wreaked havoc on the country’s drug pricing system and interfered with the medical treatment of an untold number of Americans.”

David O. Barbe, MD, president of the American Medical Association (AMA), said, “The AMA is pleased the Trump administration is moving forward with its effort to address seemingly arbitrary pricing for prescription drugs. Physicians see the impact of skyrocketing prices every day as patients are often unable to afford the most medically appropriate medications—even those that have effectively controlled their medical condition for years,” he said. “No one can understand the logic behind the high and fluctuating prices. We hope the administration can bring some transparency – and relief – to patients.”

Several Democrats also weighed in, including Representative Ron Wyden, D-Oregon. “Asking other countries to fatten Big Pharma’s wallet and expecting them to lower prices for American families is laughable—just look at the Trump tax law,” he said.

Said Representative Frank Pallone, D-New Jersey, “After promising to take on the drug industry and lower costs, today’s proposal is an empty gesture that will not meaningfully reduce the cost of prescription drugs for everyday families.” If Trump were serious, Pallone said, he would advocate direct negotiations for Medicare.

Also weighing in was Steven D. Pearson, MD, president of the Institute for Economic Review (ICER). The group's analysis of cardiovascular results for alirocumab (Praluent) recently laid the groundwork for a price break negotiated between Express Scripts and drugmakers Sanofi and Regeneron. Said Pearson: "While encouraged to see both political parties evaluating new options to reform drug reimbursement, we continue to believe the fundamental challenge in the US pharmaceutical system is that--particularly in areas with little competition--a drug's price rarely reflects the benefit for patients. There are times when our country receives tremendous value from medicine and other times when we're getting ripped off, and our healthcare system struggles to tell the difference."

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