Election Day is just about here, marking an end to the unpredictable ride that has been the 2024 presidential race following months of fierce campaigning, wild headlines and inescapable TV ads. Over the summer, a familiar song and dance between President Joe Biden and Republican candidate and former President Donald Trump rapidly evolved into a reinvigorated dash to 270 as Vice President Kamala Harris secured a late-breaking Democratic bid.
With the two major party candidates butting heads on key issues such as abortion access, immigration and the economy, one thing Harris and Trump can both agree on is a publicly stated desire to lower drug prices. Their strategies to reach that goal, though, would likely see the two embark down different paths.
A bipartisan concern
While shared ground may seem surprising for two candidates on opposite ends of the political spectrum, support for lowering drug prices is quite bipartisan, John Hopkins University associate professor Mariana Socal, M.D., Ph.D., said in an interview with Fierce Pharma. Socal specializes in health policy and prescription drug affordability.
Drug affordability in the U.S. is a problem that “has not completely disappeared” and therefore will remain an issue for the election’s winner, Socal explained. Although politicians on either side of the aisle can agree on that goal, it’s the solutions that lack a consensus.
For example, when Harris cast the tie-breaking vote to pass Biden’s crowning drug pricing achievement, the Inflation Reduction Act (IRA), zero Republicans in the U.S. Senate voted for the bill. The IRA itself is still a highly contested law, as shown in a September Senate hearing in which supporters defended the legislation as a solid first step on the road to lower drug prices. Critics, however, pointed to the law’s unintended side effects that they contend are harming innovation—a stance adopted by much of the biopharma industry.
Trump has his own history of spotlighting drug prices on the campaign trail and in office. During his first campaign for his 2016 term, he “turned this issue into an issue that could not be ignored,” John Barkett, managing director of BRG’s healthcare transactions and strategy practice, said on a recent episode of Fierce’s "The Top Line" podcast. In 2017, the then-president elect sent biotech stocks tumbling after accusing drug companies of “getting away with murder.”
When assessing which party might be able to push its pricing policy through bureaucratic gridlock, recent history suggests the Democrats have a leg up, Socal figures. Simply put, a Democratic administration would have a “much stronger starting point” due to potential carryover from the Biden administration, the professor explained.
As for Trump, while he ran into hurdles with his own drug pricing initiatives during his first term, he was able to pass measures that focused on transparency, such as his executive order that looked to expand hospital price transparency and push back against surprise billing. Those moves suggest that a Republican administration could veer on the side of transparency-focused policy, building on Trump’s own past achievements and offering “a different set of solutions," according to Socal.
While Trump’s hospital price transparency rule went into effect in 2021, his drug pricing framework—dubbed the Most Favored Nation model—failed to take off near the end of his presidency.
The framework would have identified 50 Medicare Part B single-source drugs and biologics and linked their reimbursement levels to an average of prices paid by several countries overseas. It was fiercely opposed by the biopharma industry and quickly sparked lawsuits from trade groups.
“Ultimately, the courts threw it out because he had not gone through the proper rulemaking process,” Barkett said.
That’s not to say Trump would attempt to revive the policy if elected. Recently, his campaign has plainly stated that he does not plan to pursue the program during a potential second term. Still, it’s worth noting as a unique avenue that could make an appearance in the future.
A recent report from the Congressional Budget Office analyzed several drug pricing policies that have been brought to the table, including a similar measure to Trump's that would cap U.S. prices based on overseas costs. That option could result in average price reductions of about 5%, which would be the most impactful out of the seven reviewed by the office.
IRA expansion
While Trump’s potential avenues to lower drug prices haven’t been fully communicated, Harris would presumably work to expand the IRA and build on the prior work of the Biden administration. The vice president has pledged to “accelerate the speed of negotiations so the prices of more drugs come down faster,” Harris wrote in her economic plan, dubbed “A New Way Forward for the Middle Class.”
Although she hasn’t detailed how this would play out, the effort could align with Biden’s attempt in March to widen the pool of drugs subject to Medicare pricing negotiations to up to 50 annually. As the law stands, the list of 10 eligible drugs in 2026 will expand incrementally until reaching 20 each year come 2029 and beyond.
“What she’s effectively saying is she would support Congress looking at ways to do more for the program,” Barkett explained.
Still, BMO Capital Markets analyst Evan Seigerman believes significant IRA expansion isn’t likely given the law was passed under the budget reconciliation process, making it “very hard to change,” he said in an interview.
Trump, meanwhile, hasn’t spoken much on the drug pricing aspects of the IRA. If he were to follow Project 2025, a controversial 922-page policy proposal (PDF) by The Heritage Foundation, drastic changes would be pursued under his administration to shrink the reach of the law. In effect, the drug pricing negotiation program included in the IRA would be repealed, while other pillars of the policy would stay.
Trump has vehemently denied alleged links to Project 2025 throughout his campaign. Still, Barkett sees it as a “serious document” with insights from experts who would reasonably be called to serve in a Trump administration or to provide policy recommendations.
“I would not just brush off that document just because the former president has disavowed it, and, for the same reason, I wouldn’t just brush off the most favored nation model,” Barkett said. “I read Project 2025 as being as good as any [document] you'll see with respect to the comprehensiveness of it [and] having it represent the views of what the Republican policy experts would advise President Trump to do.”
Overall, both candidates seem to be offering “somewhat benign” drug pricing policy adjustments, Seigerman said. Because the IRA is the most sweeping piece of drug pricing legislation to date and it's already locked into law, its implementation will take place no matter the winner, he pointed out.
FDA regulation
As for wider health regulation, Trump has preemptively assigned Robert F. Kennedy Jr. to the job. Kennedy, who scrapped his own campaign for presidency in August, is widely known for his anti-vaccine rhetoric and conspiracies and was even temporarily banned from Instagram in 2021 for spreading misinformation about COVID-19 vaccines. At a recent New York rally, Trump vowed that, if elected, he would allow Kennedy to “go wild on health” as well as “the medicines.”
Kennedy drove the point home with a grim message to the FDA on X, formerly Twitter, warning those who “work for the FDA and are part of this corrupt system” to “1. Preserve your records, and 2. Pack your bags.”
On the flip side, the FDA under Harris would very likely look similar to its operations under Biden. Harris would be expected to “keep a strong and independent FDA” if elected, Stifel analysts predicted in a recent biopharmaceutical sector update.
Last year, Harris pledged to defend the FDA in its legal battle with the Alliance for Hippocratic Medicine over access to FDA-approved abortion drug mifepristone. The group's lawsuit “endangers our entire system of drug approval and regulation by undermining the independent, expert judgment of the FDA,” Harris said in a statement at the time.
Trump has been somewhat vague in his commentary regarding mifepristone, but Project 2025 calls for the FDA to “reserve its approval.” The document also calls for changes to the agency, its staffing and its approval process.
The FDA, along with the IRA and the Federal Trade Commission (FTC), are three key issues for the industry in this election, the Stifel analysts opined. To that end, Harris is most attractive on the FDA front, while Trump is favored for a potential IRA walk-back, according to the firm. Trump would be “somewhat” more likely to restrict the FTC's recent activism on M&A, according to Stifel, while Harris does not appear to have a particular focus in that area.