WASHINGTON — The Trump administration’s new plan to pay for certain drugs in Medicare based on international prices quickly set off a war with the drug industry after it was unveiled Thursday — and both sides are charging ahead with aggressive statements that the other is ignoring patients.

The trade group for drug makers, PhRMA, called the proposal “price controls” and said it was “disappointed the administration put the needs of patients aside with these proposals.”

Health and Human Services Secretary Alex Azar, meanwhile, charged in a meeting with reporters that it is the industry’s high prices that form “the greatest possible barrier to patient access.”


The administration’s new proposal would gradually decrease reimbursement for physician-administered drugs over five years until the U.S. pays 126 percent of what a selection of other nations pay. The administration expects to begin piloting that program in half of the country in late 2019 or early 2020. If the administration finds that pilot worked as intended, it can then expand it to the rest of the country.

The early and heated quarrels between drug makers and the administration highlight the uphill battle the administration’s new plan faces as it moves through a long regulatory process. President Obama’s previous attempt to make sweeping changes to the way Medicare pays for drugs administered in doctors’ offices fell apart amid similar industry complaints.

This time, both sides also tell radically different stories about how the feud got this bad.

BIO, which represents many of the companies most affected by this new proposal, said in a statement Thursday that it had repeatedly implored the administration to work with the group on reforms that the industry can stomach.

“It is deeply unfortunate the Trump administration has proposed pursuing a radically different approach,” BIO wrote.

But that’s not how HHS Secretary Alex Azar tells the story. “I had challenged the pharmaceutical industry,” Azar said. “I said this since I took office: Come up with alternatives of ways to introduce competition and market-based pricing into Part B, none have come forward.”

And drug lobbyists’ attempts at explaining to the administration why drugs are cheaper in Europe apparently haven’t been going so well. One industry lobbyist told STAT that when they met with officials to explain, their ideas were met with resistance.

“They don’t give a s—,” the lobbyist said. “They just think it’s some number on a chalkboard.”

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  • To Bang Ding Ow

    I don’t think anyone wants any prices. Fair prices are needed. EU has price controls and US does not. Plain and simple.

    • G.M.: wrong.

      They’re paying less. We’re paying MORE.

      They need to pay more. We need to pay LESS. That is “fair,” lady.

      Get a clue, please. Thanks.

  • Simple fact of the matter is that the pharmaceutical industry all inclusive has lived high on the hog. They have legislators in their back pocket and know it that by scaring the populous they will win. Stern and bold action is needed. It will be interesting how far each side gives.

    My conjecture is only executive action will resolve the issues at hand. Pharma is going to scream that they are the sacrificial lamb. May be it is time as the lamb has become little too rounded and needs to go on a diet. This is a better choice for everyone rather than other alternates.

    • To the point: what DJT wants, is the pharms make Europe/Canada to PAY THEIR FAIR SHARE.

      Europe/Canada, you have been leeching off the USA for decades, the bill is NOW DUE .. deal with it like adults.

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