Who Speaks For The White House On Drug Prices? Industry Better Hope It Is Not Donald Trump

The disconnect between what Donald Trump says about drug pricing in unscripted settings and what the Administration says in more formal, policy-articulating contexts is very stark. For biopharma companies, the 'official' statements are reassuring – but it would be dangerous to discount Trump’s populist instincts altogether.

The Trump Administration’s plan for dealing with high prescription drug prices is becoming very clear – as long as you don’t ask Donald Trump about it.

Over the past two weeks there has been consistent communication across the Administration about what it intends to do regarding prescription drug pricing in the near term: focus on FDA-related regulatory reforms to encourage generic competition for off-patent products where huge price increases have dominated the headlines.

Consider the official White House “readout” of the President’s March 8 meeting with Democratic Reps. Elijah Cummings (Md.) and Peter Welch (Vt.) to discuss drug pricing: “President Trump expressed his desire to work with Congressman Cummings in a bipartisan fashion to ensure prescription drug prices are more affordable for all Americans, especially those who need lifesaving prescription medications. Reforming the Food and Drug Administration and reducing the regulatory burdens on drug manufacturers so as to enhance competition will help accomplish those goals.” (Also see "The Drug Pricing Summit Pharma Wasn't Invited To" - Pink Sheet, 9 Mar, 2017.)

Or the statements by Administration officials over the weekend on news shows, repeating the message that FDA reforms – not Medicare price negotiation – would be the key component to fulfill the President’s pledge to deal with drug pricing in the next “phases” of the Affordable Care Act repeal-and-replace process.

Or how the Republican leadership dealt with the pricing debate during the mark-up of their repeal-and-replace legislation last week. (Also see "'Repeal And Replace' Going Relatively Well For Pharma So Far" - Pink Sheet, 12 Mar, 2017.)

The issue was raised by Welch near the end of the 27-hour Energy & Commerce Committee review of the bill, the morning after he met with Trump. Welch, employing the pattern of other failed Democratic amendments, introduced a bill to delay the ACA repeal measure until it is certified to include measures that would drive down prices as promised by Trump. Reps. Michael Burgess (R-Tex.) and Gus Bilirakis (R-Fla.) spoke against the amendment, promising to address the issue in the context of the upcoming user fee reauthorization process – via reforms to encourage generic competition.

And that reflects the reality of the legislative process. In the context of the recent headlines about drug pricing, the only area that has received that substantial preparation work are ideas intended to address the egregious outlier price increases – Turing, Valeant, etc. And it is noteworthy that the third member of the team that met with Trump is a hospital executive who testified about the impact of those price increases on her health system.

So, the White House really couldn’t be any clearer about how things are supposed to play out.

If only they can get the President on board.

Trump’s own remarks, especially in unscripted settings, point to a very different set of priorities – some form of price negotiation to drive down the “astronomical” prices. And, at least according to Cummings and Welch, he repeated his support for that approach during their meeting, telling the HHS Secretary (Tom Price) to “get it done,” and then following up with Cummings in not one but two phone calls. While the White House has not confirmed that account – it hasn’t disputed it either. (Also see "President Trump And Drug Pricing: Rhetorical Improvement But Uncertainty Remains" - Pink Sheet, 1 Mar, 2017.)

What to make of the disconnect between what the “White House” says about drug pricing – and what President Donald Trump says?

First and foremost, Trump’s enthusiasm for more draconian measures cannot simply be ignored. Trump’s campaign was built on blunt, populist messages – and the unfortunately reality for innovator companies is that there are very few people who won’t applaud when the President talks tough on drug costs.

In that context, Trump’s continued support for drug pricing measures amounts to keeping his options open. If in fact the legislative process moves on to a bipartisan bill to “Replace” or just improve the Affordable Care Act, drug pricing measures seem like an obvious way to draw Democratic votes.

Still, it matters that the “Administration” is framing the issue narrowly. Presidents can’t do a whole lot on their own. And even when a President supports price negotiation and has the wholehearted support of staff across the Administration, it isn’t easy to make it happen. Just ask Barack Obama.

From the editors of the RPM Report