White House considers drug pricing executive order, prompting GOP pushback

The White House is considering one or more executive orders aimed at lowering drug prices that could come as soon as this week, prompting pushback from some GOP lawmakers and the powerful pharmaceutical industry. 

One idea under discussion, sources say, is to link some U.S. drug prices to the lower prices paid overseas, an idea that is opposed by many Republicans, who see it as a price control that violates free-market principles. 

The looming executive action comes a little more than three months from the election, on an issue that is key to voters. Democrats have been pounding Republicans on the issue of health care, pointing to a President Trump-backed lawsuit to overturn the Affordable Care Act, and executive action on drug prices could be a way for Trump to try to counter on the issue. 

But it remains unclear what exactly, if anything, will be finalized. And even once any executive orders are issued, as soon as the end of this week, it will take time for the regulatory process to unfold, meaning it is unclear what can go into effect before the election. 

The idea to link some drug prices to lower prices in other countries is said to be a variation of an idea Trump previously floated in 2018, before the midterm elections, called the International Price Index. The new variation is sometimes referred to as a “most-favored nation” clause, allowing the U.S. to get the best price of any developed country on drugs, but the details are not clear. 

Some congressional Republicans have been calling the White House in recent days to raise objections to the proposal, sources say, an effort spurred on by the pharmaceutical industry, which is rallying to try to stop the idea.

Another idea, in what could be a range of executive orders on drug prices, is reviving a previously-scrapped administration effort to ban discounts, known as “rebates,” that drugmakers pay to negotiators known as pharmacy benefit managers (PBMs). The idea is to simplify a convoluted drug pricing system and provide incentives for drugmakers to lower the sticker prices of their drugs. Politico first reported some details of these discussions. 

Drug companies support that idea, but it is fiercely opposed by insurance companies and the PBMs themselves, who are now also rallying to try to stop the proposal, pointing to projections that it could raise premiums in an election year.

White House spokesman Judd Deere declined to discuss the details of any coming orders, but said: “The President continues to explore any and all options that will deliver lower cost drugs, while ensuring we have access to the most innovative vaccines and therapeutics in the world.”

The proposal to link prices to those in other countries is the most controversial among congressional Republicans and the drug industry, though. 

A Senate GOP aide said some Republican lawmakers have been contacting the White House to make known their opposition. 

“We thought this thing was dead,” said a pharmaceutical industry source, who said the industry is mobilizing and contacting its congressional GOP allies to try to stop it. 

The conservative group FreedomWorks on Tuesday announced a six-figure Hulu and digital ad buy against the idea, warning of “socialist price controls.”

A range of leading conservative groups, including FreedomWorks, Americans for Tax Reform and Americans for Prosperity, also wrote to Trump on Monday opposing the idea and warning it would harm pharmaceutical innovation.

Some drug company lobbyists also noted a version of the idea is included in House Democrats’ signature drug pricing bill, which the White House has denounced, arguing it would make for muddled messaging for Trump to adopt the idea. 

During the 2016 campaign, Trump backed an idea normally associated with Democrats to allow Medicare to negotiate drug prices, saying he would “negotiate like crazy.”

He has since backed off that idea in office, though, and the White House opposes the House Democratic bill, passed in December.

Trump signed legislation last year to ease the introduction of cheaper generic drugs. While he has floated a range of larger ideas on drug prices in office, including importing drugs from abroad, no high-profile initiatives have taken effect so far.