Jul 26, 2019 - Health

Trump's next move on lowering drug prices

President Donald Trump

Phot: Chip Somodevilla/Getty Images

The White House is preparing another big executive order on drug prices, Reuters scooped last night.

The big picture: Citing industry sources who had discussed the plan with the administration, Reuters says that it would likely seek to lower prices in Medicare Part D, which covers drugs you pick up at the pharmacy counter. The administration's most sweeping proposal to date — to piggyback off of the lower prices in European countries — was limited to Part B, which covers drugs administered by a doctor.

  • It's not clear whether the new Part D proposal would also rely on international pricing, per Reuters. Part D is much bigger than Part B.

Between the lines: It's probably no coincidence that this threat is being floated just as the White House is trying to build support for the Senate Finance Committee's drug-pricing bill, despite Republican objections.

  • In fact, Sen. Chuck Grassley made that point explicitly, The Hill reports.
  • "Who knows what he's going to do at the last minute,” he said, referring to Trump. “If he would join forces with Pelosi, look at what that would do to everything that we Republicans stand for."
  • “It seems to me that the Grassley-Wyden approach is a very moderate approach [compared] to what could come out,” he added.

Where it stands in the Senate: Finance approved the Grassley-Wyden bill yesterday, but the proceedings left no doubt that there are still stark divisions within the GOP over drug pricing, and more resistance than we're used to seeing on policies Trump supports.

The intrigue: Nine of the committee's 15 Republicans voted against the bill. All of the Democrats supported it, leading to a final vote of 19-9.

  • The bill's proposal to cap price increases within Part D is clearly the biggest sticking point for Republicans. An amendment to strike that provision, offered by Sen. Pat Toomey, failed on a 14-14 vote.

What's next: Pharma's best bet is probably to stop the Senate from passing anything.

  • That would prevent an eventual conference between the House and Senate, in which Pelosi and Trump could make good on Grassley's predictions and strike up an alliance (if she wanted to help Trump claim a win on drug prices, which is far from a sure thing).
  • But that's a tall order, so expect pharma and its allies to keep trying to water down the Senate package while waging that bigger-picture fight.

The bottom line: “This bill is not anywhere near action on the floor,” Sen. John Cornyn (R-Texas) said yesterday, per The Hill.

Go deeper: Axios' Deep Dive on drug pricing

Go deeper