As President Trump delivers a speech that’s long on rhetoric and short on real policies to address the skyrocketing price of prescription drugs, Protect Our Care Campaign Director Brad Woodhouse released the following statement:
“Nowhere is the Trump presidency swampier than when it comes to prescription drugs. It’s no surprise that a President who chose a pharmaceutical executive as his Secretary for Health & Human Services is letting drug companies off the hook. Today’s speech is long on grandstanding and short on details, with small-ball policy proposals that only a drug company executive could love. Perhaps the million-plus dollars that multinational pharmaceutical company Novartis funneled to Trump fixer Michael Cohen has paid off after all.
“By allowing big pharmaceutical companies to avoid taking responsibility and instead scapegoat everyone but themselves for rising prices, President Trump has broken a key campaign promise. Despite what he told the American people in 2016, he confirmed today that he won’t allow drug companies’ biggest customer, Medicare, to negotiate and save seniors and taxpayers money.
“Instead, big pharmaceutical companies will continue to charge outrageous prices, the American people will keep paying more and more, and then these same companies will enjoy hundreds of billions in tax breaks. Today, Trump has once again prioritized greedy corporations over Americans’ health and financial well-being.”
Trump Administration Has Been All Talk, Backward Action On Drug Prices …
A Promise Broken on Price Negotiation. “During his presidential campaign, Trump called for the government to use its clout to negotiate Medicare drug prices, but senior administration officials said he would not call for that change — which is stridently opposed by drug companies.” [Washington Post, 5.10.18]
Pharma’s Reaction: Relief. “‘We expect President Trump’s upcoming speech on lowering drug prices to be rhetorically critical of pharmaceutical manufacturers and the supply chain, but he will not propose actions that actually threaten drugmakers’ ability to set high prices for their product,’ said Height Capital Markets analyst Andrea Harris.” [MarketWatch, 5.11.18]
Drug Prices Continue to Soar Under Trump. A report by Senate Democrats finds that the prices of the 20 most-prescribed drugs under Medicare Part D have increased substantially over the past five years, rising 10 times faster than inflation. Another report from the Pharmacy Benefits Consultants finds that over the past 14 months, 20 prescription drugs saw list-price increases of more than 200 percent.
Trump Installed Big Pharma Executives In Key Administration Posts. President Trump installed a former Eli Lily executive, Alex Azar, as his secretary of Health and Human Services and his appointment of Scott Gottlieb at FDA was described as “music to pharma’s ears.” Other pharma lobbyists writing Trump’s health policy include senior adviser at FDA, Keagan Lenihan, who joined the administration after lobbying for the drug distribution giant McKesson, former Gilead lobbyist, Joe Grogan, who reviews health care regulations at the Office of Management and Budget, and Deputy Assistant to the President for Domestic Policy Lance Leggitt, who has lobbied for a variety of drug-industry clients.
Trump’s Proposals Always Fall Far Short Of His Promises. President Trump promised that he would allow Medicare to use its buying power to negotiate drug prices directly with suppliers, but after meeting with pharmaceutical executives early in 2017, Trump abandoned that pledge, calling it “price fixing” that would hurt “smaller, younger companies.” The planned announcement to move some drugs from Medicare Part B, in which pharmaceuticals are purchased and administered by medical providers, to Part D, will do little to restrain the cost of prescription drugs for America’s seniors and falls far short of Trump’s promises.
Republican Health Care Sabotage Makes Prescription Drugs More Expensive For Millions. The Trump Administration wants to let states sell junky short-term health plans that skirt Affordable Care Act requirements. Typical short-term policies do not cover prescription drugs or maternity care, mental health care, preventive care, and other essential benefits. Not only that, but short term plans result in higher costs for people enrolled in full coverage plans as well as soaring premiums.
… While Pharma Profits
Pharmaceutical Companies Have Reaped Huge Benefits From The Trump Tax Bill. The Trump tax scam means billions of dollars in tax breaks for pharmaceutical companies. An Axios study found that 21 health care companies collectively expect to gain $10 billion in tax savings during 2018 alone. Most of the tax break windfall for health care companies is going toward share buybacks, dividends, acquisitions and paying down debt. According to Axios, nine pharmaceutical companies are are spending a combined $50 billion on new share buyback programs. All of the buybacks were announced during or after passage of the tax bill. Some drug companies are also increasing dividends for shareholders, with AbbVie increasing its cash dividend by 35 percent while also announcing a new $10 billion share repurchase program.
Massive Profits And Price Increases. Profits at seven of the largest pharmaceutical companies were up 39 percent in the first quarter of 2018. AbbVie, Amgen, Novartis, GlaxoSmithKline, Bristol-Myers Squibb, Eli Lilly, and Biogen cumulatively reported $12.1 billion in profit in Q1 of 2018. AbbVie, Amgen, and Biogen all began 2018 with price increases on some of their marquee products that far exceeded inflation.
Soaring CEO Pay. According to an Axios study, the CEOs of 70 of the largest U.S. health care companies cumulatively have earned $9.8 billion since 2010. CEOs took home nearly 11 percent more money on average every year since 2010 — far more than the wage growth of nearly all other workers. In 2017 alone, 30 health care executives made a combined $976 million.