U.S. President Donald Trump laid out his strategy to lower the prices of prescription drugs, calling his American Patients First plan the "most sweeping action in history" to reduce the costs of medicines for Americans.
"It's been a complicated process, but not too complicated," Trump said from the White House Rose Garden at the plan's May 11 unveiling.
Targeted in his plan are pharmacy benefit managers — often called middlemen — which negotiate with biopharmaceutical companies for rebates that insurance plans use to lower premiums.
"We're very much eliminating the middlemen," Trump said. "They're rich. They won't be so rich anymore."
Left out of the strategy, however, was Trump's promise to seek authority for Medicare, the U.S. insurance program for the elderly and disabled, to negotiate directly with drugmakers on prices.
Trump's proposals are based on four key strategies for reform:
* Improved competition.
* Better negotiation.
* Incentives for lower list prices.
* Lowering out-of-pocket costs.
Health and Human Services Secretary Alex Azar said the actions the administration plans to take are not "cheap political gimmicks" or "tired ideas."
He emphasized "these are not one and done," and will take time to implement, with the help of Congress needed to execute some strategies.
Among the measures the Trump administration plans to take are:
* Steps to prevent manufacturer gaming of regulatory processes, such as risk evaluation and management strategies, or REMS.
* Measures to promote innovation and competition for biologics.
* Developing proposals to stop Medicaid and Affordable Care Act programs from raising prices in the private market.
* Considering how to encourage sharing of samples needed for generic drug development.
* Additional efforts to promote the use of lower-cost biologic therapies, known as biosimilars.
* Experimenting with value-based purchasing in federal programs.
* Allowing more substitution in Medicare Part D to address price increases for single-source generics.
* Reforming Medicare Part D to give plan sponsors significantly more power when negotiating with manufacturers.
* Sending a report to the president on whether lower prices on some Medicare Part B drugs could be negotiated for by Part D plans.
* Leveraging the Competitive Acquisition Program in Part B.
* Working across the administration to assess the problem of foreign "free-riding."
* Considering further use of value-based purchasing in federal programs, including indication-based pricing and long-term financing.
* Removing government impediments to value-based purchasing by private payers.
* Requiring site neutrality in payment.
* Evaluating the accuracy and usefulness of current national drug spending data.
* Investigating tools to address foreign government threats of compulsory licensing or intellectual property theft that may be harming innovation and development, driving up U.S. drug prices.
Incentives for lower list prices
* Food and Drug Administration evaluation of requiring manufacturers to include list prices in advertising.
* Updating Medicare's drug-pricing dashboard to make price increases and generic competition are more transparent.
* Measures to restrict the use of rebates, including revisiting the safe harbor under the anti-kickback statute for drug rebates.
* Additional reforms to the rebating system.
* Using incentives to discourage manufacturer price increases for drugs used in Part B and Part D.
* Considering fiduciary status for PBMs.
* Reforms to the Medicaid drug rebate program.
* Reforms to the 340B drug discount program.
* Considering changes to HHS regulations involving drug co-pay discount cards.
Lowering out-of-pocket costs
* Prohibiting Part D contracts from preventing pharmacists from telling patients when they could pay less out-of-pocket by not using insurance.
* Improving the usefulness of the Part D explanation of benefits statement by including information about drug price increases and lower cost alternatives.
* More measures to inform Medicare Part B and D beneficiaries about lower-cost alternatives.
* Providing better annual or more frequent information on costs to Part D beneficiaries.
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