Jul 11, 2018

The illusion of lower drug prices

President Trump shakes hands with CEO of Pfizer, Ian Read. Photo: Saul Loeb/AFP/Getty Images

The bully pulpit is not, in fact, putting much of a dent in drug prices. But it's at least providing an illusion of lower prices.

The intrigue: Pfizer said yesterday that after "an extensive conversation with President Trump," it would "defer" the price increases it imposed on July 1, "to give the president an opportunity to work on his blueprint."

  • Flashback: Trump criticized Pfizer after it announced midyear price hikes on about 40 drugs, including several generics. He praised the company yesterday.
  • Reality check: Pfizer is only deferring those price hikes, not canceling them. And it’s taking its products back to what they cost in June — a time when Trump was very much of the belief that the prices were too high.

California is getting some results from a new law that requires drugmakers to tell the government and insurance companies before it raises prices beyond a certain threshold.

  • Gilead, Novartis, Novo Nordisk and Roche have each canceled or scaled back some of their planned price hikes, apparently in response to the new law, Bloomberg reports.
  • California’s law is only a disclosure requirement, not a hard limit on price hikes. But it's among the most aggressive disclosure requirements — which helps explain why the industry is suing to have it overturned, even while complying with it in the meantime.
  • Yes, but: "This is not going to change mainstream list price behavior at all," industry analyst Richard Evans told Bloomberg.

The bottom line: There’s a big difference between structural reforms and temporary rollbacks for one set of price increases.

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Federal court temporarily halts "Remain in Mexico" program

Migrant wearing a cap with U.S. flagin front of the border between Guatemala and Mexico. Photo: Jair Cabrera Torres/picture alliance via Getty Image

The 9th Circuit Court of Appeals upheld a lower court's earlier injunction on Friday, temporarily stopping the Trump administration from enforcing the Migrant Protection Protocols (MPP) — known as the "Remain in Mexico" policy.

Why it matters: Tens of thousands of migrants seeking asylum have been forced to wait out their U.S. immigration court cases across the border in Mexico under the policy. The Trump administration has long credited this program for the decline in border crossings following record highs last summer.

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Coronavirus updates: WHO raises global threat level to "very high"

Data: The Center for Systems Science and Engineering at Johns Hopkins, the CDC, and China's Health Ministry. Note: China numbers are for the mainland only and U.S. numbers include repatriated citizens.

The World Health Organization raised its global risk assessment for the novel coronavirus to "very high" Friday, its highest risk level as countries struggle to contain it. Meanwhile, National Economic Council director Larry Kudlow this morning tried to reassure the markets, which continued to correct amid growing fears of a U.S. recession.

The big picture: COVID-19 has killed more than 2,860 people and infected about 83,800 others in almost 60 countries and territories outside the epicenter in mainland China. The number of new cases reported outside China now exceed those inside the country.

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Bernie's plan to hike taxes on some startup employees

Illustration: Sarah Grillo/Axios

Sens. Bernie Sanders (D-VT) and Chris Van Hollen (D-MD) introduced legislation that would tax nonqualified stock options at vesting, rather than at exercise, for employees making at least $130,000 per year.

The big picture: Select employees at private companies would be taxed on monies that they hadn't yet banked.