Conservatives howled when Democrats pitched importing drugs from Canada and giving the U.S. government a more active hand negotiating with drugmakers to drive costs down.
But since President Donald Trump pitched both of those ideas a year ago in his blueprint for lowering drug prices, the conversation has shifted.
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Drug costs remain stubbornly high, but when conservative leaders like Republican Gov. Ron DeSantis of Florida are embracing previously “liberal” ideas like reimporting drugs from Canada, something has changed.
“Republicans no longer simply can be counted on to be a permanent ally of the industry,” said Bill Pierce, a former George W. Bush administration health official who works with health industry clients, including drugmakers.
The momentum may yet fizzle with the 2020 election looming. House Democratic leaders last week packaged a pair of narrow bipartisan bills addressing drug prices with a separate set of provisions to fortify Obamacare markets, a combination that’s likely to be a non-starter for the chamber’s Republicans when it comes to the floor this week.
But on drug prices in general, there’s been “this remarkable mind-meld” that seemed implausible even a year ago, said Ben Ippolito, an economist who focuses on health policy at the right-leaning American Enterprise Institute. “The fact that the administration is actively working to help Florida in their drug importation efforts, I would not have believed that a year ago."
Trump last week urged the Department of Health and Human Services to give DeSantis, a Trump ally, assistance in getting a Canadian import program up and running in Florida, forcing HHS Secretary Alex Azar — who used to describe importation as a “gimmick” — to express openness as long as it can be done safely and save money.
Trump's FDA last week also made it easier for drugmakers to develop, and for patients to access, cheaper versions of certain high-costs drugs like insulin — the object of intense congressional scrutiny.
Whether or how much any of this actually lowers drug prices is an open question.
Ippolito noted that some of the administration's proposals that are the furthest along are “also the ones that are relatively unlikely” to ratchet down prices. That includes the proposal, released last week, to require TV drug ads to disclose prices, and a rule expected to be finalized soon to eliminate manufacturers’ rebates in Medicare Part D, the outpatient prescription drug program.
Trump has pushed Republicans into a corner, causing many to give up the fight on policies they opposed in the past. But it’s not clear the administration will be able to keep them in line as some of its most controversial ideas start morphing from blueprints to actual legislation or formal rulemaking.
“There’s been a lot of motion. But not all motion is progress,” said David Mitchell, president of Patients for Affordable Drugs.
An administration plan to link Medicare payments for drugs that doctors administer in a hospital or other health care setting — not bought retail and taken at home — to an index of lower international prices could be the most effective in terms of lowering drug spending.
“If you think of proposals that are on the table, this is the one that would have the most immediate impact to actually lower the prices of some of our most expensive prescription drugs,” said Mitchell.
Many Republicans are conspicuously quiet on the ambitious, non-market-based plan — a positive sign for Trump given how vigorously Republican lawmakers (and some Democrats) opposed President Barack Obama’s much less radical plan to change these payments. Still, some are dubbing the proposal “government price controls,” and stoking fear that it would curb patient access.
“The skepticism is usually when you have price controls, they guarantee scarcity,” said Sen. John Cornyn (R-Texas). “And we don’t want to limit people's access to life-saving drugs any more than we want to destroy innovation by some unintended effect.”
“I’m not in favor of imposing price controls,” said Sen. Rand Paul (R-Ky.). “I think that would be a disaster.”
Senate Finance Chairman Chuck Grassley’s attempts to rally formal opposition to the proposal have stagnated, signaling conservative hesitation to go against the administration. Azar intervened with lawmakers to stop rising opposition last year, and Grassley (R-Iowa), who has been critical of the pharmaceutical industry in many respects, now refuses to comment until the plan is formally proposed.
One Republican outlier, Florida freshman Rick Scott, has introduced his own legislation to tie U.S. drug prices to the lowest prices found among five countries: Canada, France, the U.K., Japan and Germany. “We’ve got to get something done,” Scott, a close Trump ally, told POLITICO.
But these are not traditionally conservative ideas, and “Republicans are just kind of staying quiet,” said John Leppard, of Washington Analysis, which tracks how public policy impacts Wall Street. “I think it gives the administration more of a free rein to do what they want on the regulatory side,” though Republicans may not be interested in legislating. And he thinks that if deals aren’t struck fast, it gets harder to legislate as the election approaches.
“I’m dubious that this is something Republicans and Democrats want to scream kumbaya on ... and give each other a win, “ he added.
Some initiatives seem to be rolling forward. Republicans and the drug industry are putting up much smaller fights than in the past, or even voting to approve bills like those that ban certain drug industry patent settlements that can keep generic drug competition off the market (pay-for-delay) or legislation that would make it harder for brand drug companies to use FDA-mandated safety programs to stall generics (the CREATES Act).
The new environment and Trump’s steady focus on drug prices have caused Republicans and industry groups like PhRMA and the Biotechnology Innovation Organization to consider whether to support these bills in order to ward off bigger changes like government negotiation on prices.
But even bills now considered lower-hanging fruit are running into political hurdles from Democrats emboldened by the administration's appetite for change. Next week, the House will vote on a combined package of bills to lower drug prices and to bolster the Affordable Care Act marketplaces, making Republicans unlikely to vote for the measures. House Democratic leaders worry that allowing a bipartisan vote on relatively minor drug pricing bills would let the GOP claim victory on the issue. They also worry that Republicans will then refuse to negotiate on broader proposals that could more directly lower drug prices, according to an individual familiar with the strategy.
And Democrats are rising in opposition to one of Trump’s furthest developed plans — to eliminate the rebates brand drug companies pay health insurance companies in Medicare and Medicaid. HHS argues this will lead drug companies to lower the price of their products, but independent analyses from the Congressional Budget Office and others have found that is unlikely and that the plan will raise the cost of health care for the government and many Americans.
"What’s really going to count is list prices,” said Sen. Ron Wyden (D-Ore.), who has led bipartisan Senate investigations into high prices with Grassley. “And they’re just not willing to go there and get confrontational with the companies.”
The administration’s focus on eliminating rebates doesn’t impact drug companies’ prices or profits, Wyden added — a common refrain among critics of the administration blueprint.
Days ahead of the one-year mark for Trump’s plan, the administration finalized an industry-opposed rule requiring drugmakers to include prices in direct-to-consumer advertising and took a victory lap.
“When we introduced the president’s blueprint last May, there were some skeptics. It’s just a bunch of ideas, some said. Someone even made fun of how many question marks there were in the blueprint itself,” Azar said on a press call Monday. “Now, about a year to the day from that announcement, we finalized this rule, and we’ve put forth proposals for every major idea we laid out that day. Those question marks are turning into check marks.”
Yet Democrats and Republicans alike largely agree that many of the next steps will have to come from Congress.
“I think it’s probably like every administration that’s proposed [a policy blueprint]. They’ve got to get it through Congress,” said Sen. Richard Burr (R-N.C.).
“You can’t blame this one on the president. It’s Congress that is sitting on its ice-cold lazy butt and doing nothing,” Sen. John Neely Kennedy (R-La.) said.
And most say it will be years before the drug pricing agenda can be fairly evaluated.
“The sign of permanent change is when the change that was created lasts from one administration to the next,” said Pierce.
“We didn’t get to where we are in two years or five years ... this is 25 years in the making, so we aren’t going to change anything in one or two years even if we pass law,” he added.