Trump Signs New Executive Order to Lower Drug Prices Under Medicare

President Donald Trump signed a new executive order on September 13 requiring Medicare to base the prices it pays for drugs on those paid by other countries in attempt to lower costs for U.S. senior citizens.

The recent order expands on an executive order signed on July 24, which aimed to lower costs for medications administered in health clinics and doctors’ offices that are covered under Medicare Part B. Implementation was delayed as the administration attempted to work with the pharmaceutical industry on a solution. The new action extends to drugs available at pharmacies, covered by Medicare Part D.

Medicare is currently prohibited from negotiating drug prices with manufacturers. Negotiations between governments and drug makers are usually confidential, so accessing other countries’ drug pricing information could be challenging.

“[The executive order] does not by itself do anything. It has to be followed up by regulations, which will take time,” Larry Levitt, a health economist at the Kaiser Family Foundation, wrote on Twitter.

Industry groups oppose the mandate, which PhRMA called “a reckless attack on the very companies working around the clock to beat COVID-19.”

“We will use every tool available – including legal action if necessary – to fight this risky foreign price control scheme,” Michelle McMurry-Heath, President and CEO of The Biotechnology Innovation Organization, said in a statement.

Source: Reuters, September 15, 2020.