U.S. President Donald Trump is seated prior to signing an executive order regarding social media companies in the Oval Office of the White House in Washington, U.S., May 28, 2020.
Jonathan Ernst | Reuters
President Donald Trump announced Friday he will sign four executive orders aimed at lowering the high cost of prescription drugs in the United States in what he said would restructure the prescription drug market in the U.S.
The orders, which are subject to the regulatory review process, are designed to bring U.S. drug prices at least on par with their costs overseas. Trump said Americans often pay 80% more for prescription drugs than Germany, Canada and other nations for some of the most expensive medicines.
“The four orders I’m signing today will completely restructure the prescription drug market in terms of pricing and everything else to make these medications affordable and accessible for all Americans,” Trump said at the White House. “Under my administration, we’re standing up to the lobbyists and special interests and fighting back against a rigged system.”
The first order targets insulin prices, requiring federal community health centers to pass discounts they receive on the drug and EpiPens directly to patients. Trump said those providers shouldn’t receive discounts for themselves while charging their patients “massive, full prices.”
The second order would allow states, pharmacies and wholesalers to import drugs from Canada where they typically cost less than in the U.S.
Trump made lowering drug costs one of his key health-care issues early in his term. But drug pricing has taken a backseat over the last year as the Trump administration has shifted its focus to other priorities such as the teen vaping epidemic and now the coronavirus, which continues to rapidly spread through the United States with more than 4 million cases as of Friday, according to data compiled by Johns Hopkins University.
Earlier this week, Trump warned that the coronavirus pandemic in the U.S. will probably “get worse before it gets better” and urged the public to wear face masks to help curb the spread of the virus.
Industry trade group PhRMA, or the Pharmaceutical Research and Manufacturers of America, has argued that drug price hikes over the years have been modest, and have cited concerns with the nation’s rebate system. Those are the discounts drugmakers give to middlemen, also known as pharmacy benefit managers, often in exchange for more favorable insurance coverage for their drugs. The group has favored changes to Medicare, including capping the amount seniors would pay for on their own at the pharmacy counter every year.
The SPDR S&P Pharmaceuticals ETF (XPH), which tracks drug stocks, was more than 1% lower ahead of Trump’s announcement.
Even though Trump issued the executive orders, it may take months for the administration to finalize them.
This is a developing story. Please check back for updates.