I come to praise Donald Trump, not to bury him. Shocking as it sounds, the president actually had a good idea recently. He may let Americans get cheaper, foreign-made pharmaceuticals in certain circumstances.
Trump being Trump, I must qualify my praise. The administration also shot down Massachusetts’ request for authority to lower drug prices, a worthy experiment that should have been given a try.
But for a moment, let’s stay positive. The possible plan to allow importation of foreign drugs is a vast improvement from May, when Dr. Trump prescribed what amounted to chicken soup for drug-price inflation: His ideas couldn’t hurt, but their limitations earned experts’ collective meh.
The new proposal begins to mend a campaign pledge that Trump broke. Having called for drug importation as a candidate, he left that out of his May plan, to the delight of pharmaceutical companies that oppose the idea. (Their stocks rose after Trump announced his plan.)
Now, the administration has announced that the Food and Drug Administration will consider a procedure under which, if a drug maker hikes the price of a generic drug — and there’s no ready substitute on the domestic market — the FDA would allow foreign substitutes into the country.
Yes, the substitution would apply only to generic drugs and only for a limited time. But experts praise it as a first step, with one calling it “a smart move." It addresses a big problem, the lack of competitors for many generics, which accounts for much of the tripling in drug shortages the U.S. experienced between 2007 and 2012, Vox reported.
Because they often lack adequate substitutes to compete with them in the market, many generics have soared in price of late. This is not good, considering that generics are supposed to be cheaper alternatives to pricey, brand-name pharmaceuticals.
Remember the case of Martin Shkreli, the pharmaceutical CEO who became the poster boy for greed after raising the cost of a life-saving pill from $13.50 to $750? That was a generic drug.
Clearing bureaucratic obstacles to imports of foreign generics was a key suggestion of a Brookings Institute report last year. And leveraging cheaper prices abroad is hardly a new idea.
Two decades ago, Bernie Sanders became the first congressman to bus constituents to Canada to buy prescription drugs at a bargain, and copycat colleagues quickly boarded their own buses. There were no reports of mass poisonings due to supposedly inferior foreign drugs, despite heavy-breathing warnings from the domestic industry.
All in all, importation is meatier policy than Trump’s ballyhooed jawboning of Pfizer into delaying threatened price hikes, a presidential intervention that affected just one company and may be a short-lived palliative.
It’s also more responsible than the administration’s thumbs-down on Massachusetts’s request that its Medicaid program be allowed to create a formulary, or list of drugs that Medicaid would cover. The idea was that the federal-state health program for the needy could reject drugs the state deemed too costly or ineffective. This would have given the state bargaining power to demand reasonable prices from drug makers in exchange for putting their wares on the list.
Drug makers naturally aren’t in love with the idea, and some patient advocates were leary that vital drugs might not make the cut. Their fear demonstrates why drug-rejection power would be a tough sell to the public, not just to pharmaceutical executives.
But against that fear, we need to remember that (a) private insurers use formularies, (b) other countries use them to wrestle down drug prices, and (c) economists endorse giving similar price-haggling authority to Medicare, the federal program for the elderly. (Not doing so is another broken Trump promise.)
Oh, and (d), runaway drug prices, generic and otherwise, literally are a life-and-death matter, as stray instances of diabetics dying because they rationed expensive insulin show.
Don’t get me wrong: Overall, Trump’s ideas for fighting the drug-cost colossus are akin to taking a toothpick to a fencing match. But he typically enters policy battles disarmed of any decent ideas at all. That he has come up with one in drug importation is a pill to temporarily ease his critics’ ever-spiking blood pressure.