Already the Democrats in Congress are showing they're serious about tackling drug prices, not only with new bills, but a new name-and-shame investigation, too. But those bills are "flawed"—and likely to fail—unless Trump crosses the aisle, one analyst said. As he sees it, the president might just do that.
Last week, Democratic House members and Sen. Bernie Sanders rolled out a slew of familiar drug pricing proposals, and Sen. Susan Collins encouraged the White House to cooperate. After all, Trump has repeatedly railed at pharma for high prices and said he'd push them down.
In a note Monday, Bernstein analyst Ronny Gal wrote that while he views the latest bills as “flawed,” he wonders whether the Trump administration will see them as an opportunity to “cross the aisle” and start working with Democrats on drug prices.
“This seems unlikely, but this president found a way to work with Kim Jong-un, Putin, and Erdogan,” Gal wrote. “He may find a way to work with Bernie Sanders.”
And just days after rolling out that slate of proposals, Congressional Democrats fired another shot against pharma Monday. Rep. Elijah Cummings, Chairman of the House Committee on Oversight and Government Reform, launched a probe of 12 drugmakers, including a who's who of Big Pharma.
Humira maker AbbVie and its Imbruvica partner Johnson & Johnson—plus the trio of top diabetes drugmakers Eli Lilly, Sanofi and Novo Nordisk— and seven more pharmas were asked for detailed info on price hikes, R&D investment, and "corporate strategies to preserve market share and pricing power." The committee plans to hold hearings over the next few weeks to learn more on the issue.
Meanwhile, there’s been a “flurry of activity” on pricing to start 2019, Gal pointed out. Fourteen of the top 20 pharma companies have raised list prices so far this year, according to Gal's Monday note. Pfizer, while not in that group, is set to raise prices Tuesday, the company said in November.
Amid all of the scrutiny, complexity in the U.S. drug pricing system has left many split on how best to address the issue. In proposals last week, Democrats suggested importation, Medicare price negotiations and tying U.S. prices to lower prices elsewhere.
At the HHS, officials are working to force drug prices in TV ads and lower prices in Medicare and Medicaid. FDA officials, for their part, have boosted generic approvals and are looking at other areas in drug markets where competition is lacking.
After years of gridlock in Washington, many states have taken the issue into their own hands. California notably passed a bill that forces drugmakers to give warning of price hikes that total more than 16% over two years.