There was much-anticipated drug pricing news from the White House yesterday, as President Trump announced he was signing a series of Executive Orders as they relate to medication pricing. These Executive Orders help Medicare recipients and others manage the rising costs of life-saving medication for example insulin and epinephrine pens. The President said, “I’m signing four sweeping executive orders that will lead to a massive reduction in drug costs,” [This] will completely restore the prescription drug market in terms of prices”.
…to virtual pennies. Epi-pens went from their incredibly high, jacked up prices, to lower than their original give away bargains. Biggest price reductions in history, by far! Nothing like this has ever for our citizens, especially our Seniors. REMEMBER YOUR FAVORITE PRESIDENT!
— Donald J. Trump (@realDonaldTrump) July 25, 2020
Here is the breakdown according to the White House release of the Executive Orders:
Executive Order on Increasing Drug Importation to Lower Prices for American Patients. “One way to minimize international disparities in price is to increase the trade of prescription drugs between nations with lower prices and those with persistently higher ones. Over time, reducing trade barriers and increasing the exchange of drugs will likely result in lower prices for the country that is paying more for drugs. For example, in the European Union, a market characterized by price controls and significant barriers to entry, the parallel trade of drugs has existed for decades and has been estimated to reduce the price of certain drugs by up to 20 percent. Accordingly, my Administration supports the goal of safe importation of prescription drugs. The Secretary of Health and Human Services shall, as appropriate and consistent with applicable law, take action to expand safe access to lower-cost imported prescription drugs”.
Executive Order on Lowering Prices for Patients by Eliminating Kickbacks to Middlemen: This EO eliminates the middleman who would normally get a kickback from the drug manufacturers to health plan sponsors, pharmacies, or pharmacy benefit managers (PBM’) and thus passing the savings onto patients. “It is the policy of the United States that discounts offered on prescription drugs should be passed on to patients“.
Executive Order on Access to Affordable Life-saving Medications: More Affordable Insulin and EpiPens: “Insulin is a critical and life-saving medication that approximately 8 million Americans rely on to manage diabetes. Likewise, injectable epinephrine is a life‑saving medication used to stop severe allergic reactions. The price of insulin in the United States has risen dramatically over the past decade. The list price for a single vial of insulin today is often more than $250 and most patients use at least two vials per month. As for injectable epinephrine, recent increased competition is helping to drive prices down. Nevertheless, the price for some types of injectable epinephrine remains more than $600 per kit. While Americans with diabetes and severe allergic reactions may have access to affordable insulin and injectable epinephrine through commercial insurance or Federal programs such as Medicare and Medicaid, many Americans still struggle to purchase these products”.
“It is the policy of the United States to enable Americans without access to affordable insulin and injectable epinephrine through commercial insurance or Federal programs, such as Medicare and Medicaid, to purchase these pharmaceuticals from an FQHC at a price that aligns with the cost at which the FQHC acquired the medication“.
There is a fourth Executive Order that will go into effect on August 25, 2020, that will require Medicare to purchase medication at the same prices that are paid by foreign countries which can be significantly less. This prevents the U.S. from continuing to pay for the cost of research and development for other countries. Medicare will be able to negotiate pricing which will help patients to pay less for the same prescription medication. The delay in signing this Executive Order is to give companies time to find alternative solutions for funding their cost for research and development.
During the press conference, The President, asked Paul Madden, an insulin-dependent diabetic senior citizen from Boston who has lived with diabetes for 59 years, to speak. Madden spoke about how the lowering of insulin pricing will positively impact him and the 34 million other people who live with diabetes. “Last year I realized quickly my ability to afford prescribed insulins that worked best for my health was no longer possible because of their excessive high price. Soaring costs have impacted the quality of my life“. He continued, “It has impacted me so much that I even started to use a 30-year-old insulin to survive which does not do quite the same job of balancing my diabetes. To ensure that insulin is affordable under Medicare will help guarantee that I and millions of seniors who take insulin realize more healthier and more productive and independent, happier lives“.
The President full remarks and signing can be seen here.