While President-elect Donald Trump recently said that the pharmaceutical industry is “getting away with murder” in terms of drug prices, the industry is trying to self-regulate before facing tighter rules from the incoming administration.
“Pharma has a lot of lobbies, a lot of lobbyists and a lot of power. And there’s very little bidding on drugs,” Trump said during a press conference in New York. “We’re the largest buyer of drugs in the world, and yet we don’t bid properly.”
According to current laws, the government cannot negotiate with pharmaceutical manufacturers on prices of drugs via Medicare. It is unclear whether Trump will seek to change this policy.
At the same time, Goldberg believes that a Trump administration will signal lower out-of-pocket costs for consumers and greater access to medications. “The key to achieving this is not price controls. Rather, the focus will be on changing the way drugs are paid for and developed,” Goldberg said.
“It is possible to spread the cost of drugs over time and prevents segments of the population from having to choose between going into bankruptcy or hospice,” Goldberg said. “Drug companies give rebates to PBMs and insurance companies to get the best formulary placement. These rebates could go directly to patients.”
In addition, the Trump administration will likely try to speed up approval of new medicines and reduce FDA’s backlog of generic drug application, Goldberg said.
Drugmakers are already making efforts to curb prices. During the J.P. Morgan Healthcare Conference, an AbbVie executive said the company would keep drug price hikes to single-digit increases annually. Allergan and Novo Nordisk made similar promises last year.
Mylan Pharmaceuticals, which faced significant criticism last year for its EpiPen price hikes, has increased rebates to patients using the EpiPen and launched a generic EpiPen last year.
“The pricing model has got to change. It’s not incremental change; I don’t think that’s what this country needs. I think it’s truly rethinking the business model,” said Heather Bresch, chief executive of Mylan at the J.P. Morgan Healthcare Conference, The Washington Post reported.
“Improving affordable access to medication is exactly what we do,” Brian Henry, a spokesperson for pharmacy benefit manager (PBM) Express Scripts, told FormularyWatch. Examples of this include “our work to bring down the cost of a cure for hepatitis C to less than what is paid in Europe, indication-based pricing for medications that treat inflammatory conditions, and outcomes-based pricing where payers get a refund when patients don’t adhere to therapies or when the drug doesn’t work.”
Read more: Medicare drug pricing debate heats up