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Trump wants foreign countries to pay more for U.S. drugs

By Modern Healthcare | May 10, 2018

President Donald Trump on Friday is expected to suggest using trade negotiations to convince foreign countries to increase what they pay for prescription drugs made in the U.S., according to sources.

Trump previously has said that lower prices paid in Canada, South Korea and a number of European countries devalue the research and development costs of producing new therapies in the U.S. He said the payment practice was akin to "global freeloading."

In a report earlier this year, the White House Council of Economic Advisers stated that profit margins on brand-name drugs in the U.S. were four times higher than those in some major European countries. The report said that South Korea, under a request by the White House, has agreed to pay higher prices for some drugs made in the U.S.

HHS Secretary Alex Azar in a speech this week hinted at the administration's move, saying that foreign governments were "free-riding" off the high costs that drugmakers set in the U.S.

Azar also pointed the finger at pharmacy benefit managers, which he said profit from rebates paid by drug companies that ask for their products to be favored in formularies. Those rebates aren't passed on to the consumer, Azar said.

Food and Drug Administration Commissioner Dr. Scott Gottlieb last week said tweaking the law that protects these rebates could be key to lowering prices.

"What if we took on this system directly, by having the federal government re-examine the current safe harbor for drug rebates?" Gottlieb asked.

Trump is expected to present his speech at 1 p.m. EDT on Friday.

http://www.modernhealthcare.com/article/20180510/NEWS/180519999/trump-wants-foreign-countries-to-pay-more-for-u-s-drugs?itx[idio]=66353&ito=792&itq=947bea1f-da57-419a-a997-ac103f4bf063