After meeting with pharma lobbyists, Trump drops promise to negotiate drug prices
After meeting with pharma lobbyists, Trump drops promise to negotiate drug prices
http://www.vox.com/policy-and-politics/2017/1/31/14453740/trump-medicare-prescription-drugs
A lot happened in the 2016 campaign, but one of the things Donald Trump did to win the election was shift to the left on a number of key issues promising to avoid cuts in Social Security and Medicare benefits and adopting a longstanding Democratic pledge to let Medicare negotiate bulk discounts in the price it pays for prescription drugs.
Today, after a meeting with pharmaceutical industry lobbyists and executives, he abandoned that pledge, referring to an idea he supported as recently as three weeks ago as a form of price fixing that would hurt smaller, younger companies. Instead of getting tough, Trumps new plan is that hes going to be lowering taxes and getting rid of regulations.
New drugs are generally covered by patent monopolies, so drug companies have a lot of pricing power; other companies cant produce the same drug without paying royalties, so theres little competition. But most countries use their nationalized health care systems to negotiate a good deal on drug prices. Manufacturing pills is cheap, so its usually still profitable for a company to sell medicine at a pretty steep discount.
The United States doesnt have a nationalized health care system, but we do have Medicare for senior citizens, and since the USA is a very large country, thats still a huge potential bulk purchaser. But a 2003 law written by congressional Republicans and signed by George W. Bush prohibits the federal government from using that negotiating power.