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President's pledge to merge drug pricing control with a revamp of the Affordable Care Act wins applause at Kentucky rally, where the president reeled through a number of his populist issues, even as the idea makes scant legislative progress.


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Legislation establishing prescription drug price controls through a government-run "competitive bidding" process will be included in one of the bills that will repeal and replace the Affordable Care Act (ACA), President Donald Trump promised at a rally in Louisville, Ky. March 20.


Trump raised drug pricing at the campaign-style rally as one of his now-familiar populist issues, which also includes revoking the ACA, immigration reform, new trade deals and a loosening of environmental restrictions. Whether drug pricing continues to garner high-profile public attention may depend in part on whether Trump continues to hold such events.


And whether drug price controls get enacted is an open question. Comments and action by the Trump Administration have signaled a less drastic agenda for addressing high drug costs. (Also see "Who Speaks For The White House On Drug Prices? Industry Better Hope It Is Not Donald Trump" - Pink Sheet, 14 Mar, 2017.)

 

"The cost of medicine in this country is outrageous, many times higher than in some countries in Europe and elsewhere," Trump said.


Referring to the high prices charged for drugs in the US relative to other countries, he added: "Why? Same pill, same manufacturer, identical, and it's many times higher in the United States. You know why? Campaign contributions? Who knows, but someone is getting very rich."


"We're going to have a great competitive bidding process. Medicine prices will be coming way down, way, way, way down and that's going to happen fast," he promised.


Trump did not provide specifics about the kind of controls he is promoting. Legislation authorizing HHS price negotiations for Medicare Part D drugs has been viewed as one possible interpretation. However, industry lobbying has successfully beaten back efforts to establish such authorization for years and it's uncertain at best whether Trump would find the votes in the Congress to enact it.


Trump suggested that a drug pricing provision would be added to legislation being planned to repeal and replace the ACA, an approach to addressing the issue that was announced earlier in March by members of the Administration. (Also see "Drug Pricing ‘Solutions’ Coming In Future Phase Of US Healthcare Reform, Sec. Price Says" - Pink Sheet, 7 Mar, 2017.)


The president said he would like to see drug pricing added to the American Health Care Act, which House Republicans leaders hope to bring to a floor vote later this week. But he conceded it is more likely to be included in an upcoming bill addressing additional ACA "replace" policies.


"I said, 'we got to add [drug pricing] to the [current House] bill,'" he pointed out. But "if we can't," he added, "we've got to do a bill later" and can do it "right after."

 

 Amended Repeal Bill Accelerates Pharma Tax Rollback

 

House Republican leadership released revisions to the AHCA late on March 20 aimed at addressing reservations with the bill that have been expressed by GOP conservatives. Among the changes is a provision allowing states greater flexibility in designing Medicaid programs by allowing them the option of a choosing a block grant for the federal government's contribution to funding.


Biopharma companies have been concerned that Medicaid block grant proposals could lead to greater use of restrictive formularies. (Also see "Medicaid Drug Formulary Ideas Floated, But US Manufacturers Are Skeptical" - Pink Sheet, 1 Mar, 2017.)


The amended version would also accelerate the repeal of the annual pharmaceutical fee, which the Congressional Budget Office estimates will reduce federal revenues by $24.8bn over 10 years. The fee was established by the ACA to help support Medicare funding.


The original AHCA bill repealed the tax effective in 2018 and the new version makes the repeal effective in 2017, which could save drug companies an additional $3bn this year. The revenue collected by the annual fee is deposited in the Medicare trust fund that supports Parts B and D.


Rep. Lloyd Doggett, D-Tx., challenged the pharma tax repeal in a statement on the House floor March 21. "With Big Pharma’s exceptional distinguished service in charging astronomical prices and blocking competition to their government-approved monopolies, these Republicans have included a ‘no-strings-attached’ $25 billion tax windfall for Big Pharma in their so-called ‘Obamacare repeal,’ Doggett said.


"Now with their latest late night amendment – that prize is already growing bigger and bigger by the moment. And all of those American families out there struggling, trying to access life-saving drugs, they don’t win a dime in this contest. Let’s reject this phony Republican giveaway where only Big Pharma is the big winner.”

 

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