It is well known that Donald Trump’s pick to head the Department of Health and Human Services, Representative Tom Price (R-GA) wants to essentially abolish Medicare, Social Security and Medicaid. During his campaign and as late as January 11, Trump promised to change the policy that blocks Medicare from negotiate drug prices to reduce costs.
“Pharma has a lot of lobbies, a lot of lobbyists and a lot of power. And there’s very little bidding on drugs,” Trump said during the event at Trump Tower in New York. “We’re the largest buyer of drugs in the world, and yet we don’t bid properly.”
Federal law forbids the government from negotiating with drug companies to bring down the price of drugs for seniors using Medicare. While Trump did not announce a specific plan to address the issue, he has in the past called for ending the policy — a proposal that Democratic lawmakers have repeatedly put forward.
Price is opposed to that.
As reported at Vox, Trump has now gone back on that pledge:
Today, after a meeting with pharmaceutical industry lobbyists and executives, he abandoned that pledge, referring to an idea he supported as recently as three weeks ago as a form of “price fixing” that would hurt “smaller, younger companies.” Instead of getting tough, Trump’s new plan is that he’s “going to be lowering taxes” and “getting rid of regulations.”
New drugs are generally covered by patent monopolies, so drug companies have a lot of pricing power; other companies can’t produce the same drug without paying royalties, so there’s little competition. But most countries use their nationalized health care systems to negotiate a good deal on drug prices. Manufacturing pills is cheap, so it’s usually still profitable for a company to sell medicine at a pretty steep discount.
The United States doesn’t have a nationalized health care system, but we do have Medicare for senior citizens, and since the USA is a very large country, that’s still a huge potential bulk purchaser. But a 2003 law written by congressional Republicans and signed by George W. Bush. [..]
I’ll oppose anything that makes it harder for smaller, younger companies to take the risk of bringing their product to a vibrantly competitive market. That includes price-fixing by the biggest dog in the market, Medicare, which is what’s happening. But we can increase competition and bidding wars, big time.
So what I want, we have to get lower prices, we have to get even better innovation and I want you to move your companies back into the United States. And I want you to manufacture in the United States. We’re going to be lowering taxes, we’re going to be getting rid of regulations that are unnecessary.
Where is the Tea Party now? Resist.