President Trump asserted late Friday that drug prices declined for the first time in nearly 50 years, implying in a tweet that his administration’s efforts to speed generic drugs to market were responsible for that historic feat.

But in the context of America’s prescription drug market, the statement is both a non sequitur and demonstrably false.

A recent analysis of brand-name drugs by the Associated Press found 96 price increases for every price cut in the first seven months of 2018. At the start of last year, drug makers hiked prices on 1,800 medicines by a median of 9.1 percent, and many continued to increase prices throughout the year.

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Trump’s tweet comes just days after the president summoned his top domestic policy advisers, including health secretary Alex Azar, to the White House to discuss the slate of drug price hikes that came Jan. 1, as an HHS spokeswoman confirmed to STAT. Last week, Trump blasted pharmaceutical companies for those increases, writing on Twitter “drug makers are not living up to their commitments.”

Azar, who has been vocally defending his agency’s work to lower drug prices in television appearances and on Twitter this month, tweeted last week that price increases so far this year are smaller and fewer than they were in 2018. On Jan. 1, drug markers bumped up prices of 1,026 drugs by a median of 6 percent.

But that has nothing to do with the question of whether prices actually fell in 2018, which they did not. Azar retweeted Trump’s claim of an historic price drop in 2018, but tacked on a comment saying, “President Trump has done more to address high drug prices than any President in history. More to come!”

To support his claim of a price drop, Trump asserted that Americans saved $26 billion on prescription drugs during the first 19 months of his administration. The $26 billion figure comes from an October report published by the White House Council of Economic Advisors, which stated in part: “We find that growth in relative drug prices has slowed since January 2017, that generic drugs are being approved at a particularly rapid pace, and that savings from new generic entrants totaled about $26 billion as of July 2018.”

The report argued that “relative growth” in drug prices has slowed — not that there has been a broad-based decline in prices. It is true that Trump’s FDA has approved a record number of generic drugs, after instituting policies to speed such drugs to market.

That is, indeed, a historic feat. But it is a far cry from reducing actual prices. Prices have dropped in discreet cases, but increases remain far more common. It remains to be seen whether Trump and congressional Democrats — now locked in a stalemate that shutdown the government — will be able to come together to take more forcible actions on drug prices this year.

Lev Facher contributed reporting.

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    • The Bureau of Labor Statistics measure refers to net prices. The decline it records does not reflect list prices, which are rising and are the cause of the increase in patients out-of-pockets costs for medications. The decline in the BLS measure reflects the advent of copay accumulators, a tool insurers are using to shift more costs to patients and pharmaceutical companies. STAT’s Ike Swetlitz has written about the fallacy of relying on the BLS measure to claim a broad-based decline in prices. https://www.statnews.com/2019/02/07/trump-claims-drug-prices-have-fallen-but-hes-cherry-picking-that-data/

      Pat Skerrett
      STAT

  • That’s a very understandable impression, but the CPI measures something different.

    CPI focuses on the consumer (patient) price, but most patients have insurance. So that at-the-pharmacy price in the CPI doesn’t reflect what the manufacturer is charging Medicare. (Or whatever insurance company.) For the price increases made by drug-makers, the PPI would be more meaningful although it’s still murky.

    The BLS’s own description:
    https://www.bls.gov/ppi/pharmpricescomparison.pdf

    And a clearer summary of the complications, though it’s from a political foundation so one should of course be mindful of their perspective:
    https://www.brookings.edu/research/an-evaluation-of-the-cpi-indexes-for-prescription-drugs/

  • If you want drug pricing to be reigned in, then stop stomping all over Trump. At least he is not afraid of risking his political career: he is speaking out, and not sticking his head in the sand. He happens to be fighting a very worthy fight – people should not have to chose between food or the meds they need to stay alive (a ridiculous third-world situation in the Big USA). Your President is on to something very positive – he deserves applause, not scorn. The media are losing sight of this, very evidently. For Shame !!!

    • The problem with Trump, he says one thing and does another. He is completely untrustworthy. Not to mention- makes false claims on an hourly basis.

  • I wish you would forward this piece to the relevant editors of major news sources. People are struggling and even dying (consider the tripling of the cost of insulin) while the drug prices demanded by Big Pharm are rising, at best, faster than inflation and SS checks. 6% is more than 3x the 2018 inflation rate.

    • The BLS data do show a drop in prescription drug cost in the second half of 2018. Up till then the trend was pretty continuous for many years. We’ll see if this continues – if so the Trump administration should get some credit. Cost is way too high overall, so a considerable decrease is needed for many products (e.g. insulin).

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