Patients may not gain much from Trump drug price deals
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The Trump administration portrays its deals with drug manufacturers as major victories against rising drug prices — but they won't have a huge impact on most consumers' wallets.
Why it matters: Tying U.S. prices to what's paid abroad doesn't guarantee Americans will pay less — especially in Medicaid, where out-of-pocket costs already are capped.
- And the discounted prices that will be offered on the government's TrumpRx portal may not benefit the more than 305 million Americans with insurance, who'll likely have access to cheaper medicines through their plans.
State of play: Five drugmakers — Pfizer, AstraZeneca, EMD Serono, Eli Lilly and Novo Nordisk — have struck deals with the Trump administration so far, and more deals are expected.
- Few details are available on the actual terms of these deals. AstraZeneca said the specifics of its agreement will remain confidential.
- The companies will offer drugs at lower cash-pay prices to consumers through TrumpRx.
- They'll also give state Medicaid programs access to their medications at the lowest prices paid by other developed countries through a newly announced pilot program, which is voluntary for both drugmakers and states.
Where it stands: Most Medicaid enrollees already pay no more than $8 out of pocket for prescription drugs. The new deals aren't going to lower that further.
- The marked-down cash prices on TrumpRx could offer the convenience of comparison shopping — but the 92% of Americans who already have health coverage likely have lower out-of-pocket costs through their plans, said Edwin Park, research professor at the McCourt School of Public Policy at Georgetown University.
- "There's been a lot of more pomp and circumstance around the bilateral deals than their real impact will be," said Steve Knievel, access to medicines advocate at Public Citizen.
- "It's unclear how sustainable they'll be, to the extent they're voluntary arrangements and being done through pilot models."
Yes, but: Last week's deal on GLP-1 anti-obesity drugs could be the exception.
- Many employers won't cover GLP-1s for weight loss because of the upfront expense, so reduced cash prices could make a big difference. The pricing deal also expands Medicare coverage and could influence more states to cover the drugs through Medicaid.
- Notably, Trump said the deal will cap Medicare enrollees' out-of-pocket costs for the drugs at $50 a month, which could also ease patients' cost burden.
What they're saying: It's true that insured Americans may pay less for drugs than the TrumpRx cash price in some cases, a White House official told Axios. But the arrangement could prod more employers to integrate direct-to-consumer drug purchasing into their health plans, the official said.
- The administration wants to create additional options at affordable prices, which in turn should put downward pressure on private insurance.
- Centers for Medicare and Medicaid Services officials also say that drug price savings could allow states to redirect dollars to other areas and improve care for Medicaid enrollees as they face a nearly $1 trillion cut to federal Medicaid funding over the next 10 years.
Reality check: It's an open question whether the governmental savings the administration is touting will actually materialize.
- State Medicaid programs already tend to have good deals through manufacturer rebates. Modeling by strategy firm Capstone said it's possible states are sometimes getting a better deal than international pricing.
- "When you look from the outside [the Medicaid deal] seems very extensive," said Angela Lamari, health care vice president at Capstone.
- "But I do think what goes missed is the mechanics of how it currently operates, and the substantive discounts that are currently going to the states."
The White House official told Axios that the administration expects the deals it has made to yield substantial savings for the vast majority of drugs, with a few exceptions.
