Trump Attacks Drugmakers on Pricing
January 11 2017 - 4:17PM
Dow Jones News
By Joseph Walker
Donald Trump attacked the pharmaceutical industry on Wednesday
in his first press conference as president-elect, accusing
drugmakers of "getting away with murder" and pledging to "save
billions of dollars" by changing how the U.S. purchases drugs.
"Pharma has a lot of lobbies, a lot of lobbyists and a lot of
power," Mr. Trump said. "And there's very little bidding on drugs.
We're the largest buyer of drugs in the world, and yet we don't bid
properly. And we're going to start bidding and we're going to save
billions of dollars over a period of time."
Mr. Trump's comments rattled the stock market, and shares of
drugmakers fell sharply. The Nasdaq Biotechnology index fell 3% in
midafternoon afternoon trading. Shares of Pfizer Inc. were down
1.7% and Bristol-Myers Squibb Co. declined 4.9%.
Drugmakers are under increasing political scrutiny for their
aggressive pricing of prescription drugs, which cost the U.S.
health-care system $324.6 billion in 2015, a 9% increase from the
prior year, according to the Centers for Medicare and Medicaid
Services.
In response to Mr. Trump's remarks, the drug industry's main
trade group said that the U.S. already has a competitive
marketplace for purchasing drugs, where private health insurers
negotiate lower prices.
"We look forward to working with the new administration and
Congress to advance proactive, practical solutions to improve the
marketplace and make it more responsive to the needs of patients,"
the Pharmaceutical Research and Manufacturers of America, said.
Mr. Trump's relatively brief remarks on Wednesday, made early
during a press conference focused on other topics, didn't include
any new policy proposals or a timeline for when he would pursue the
changes. It is unclear how important a priority drug prices will be
for the new administration, and whether he will win backing from
the Republican-controlled Congress.
While Mr. Trump said on Wednesday that the U.S. would become
more aggressive in bidding for drugs, it was unclear what that
would entail. "The other thing we have to do is create new bidding
procedures for the drug industry because they're getting away with
murder," Mr. Trump said.
Mr. Trump said during his presidential campaign in January 2016
that he supported allowing Medicare, which covers prescription
drugs for seniors and the disabled, to directly negotiate prices
with drugmakers -- something it is currently barred by law from
doing. The pharmaceutical industry is deeply opposed to the
government negotiating drug prices, which it views as akin to price
controls.
Mr. Trump called the drug industry "a disaster," and chided it
for not manufacturing enough of their products in the U.S. and
moving to overseas locations. "They're leaving left and right. They
supply our drugs, but they don't make them here, to a large
extent," Mr. Trump said.
Mr. Trump's victory over Hillary Clinton in November was
initially seen as positive for the drug industry, a frequent target
of Mrs. Clinton's during her campaign, and drug stocks soared after
the election. But Mr. Trump's remarks on Wednesday signaled that he
may be more antagonistic to the industry than it first thought.
Write to Joseph Walker at joseph.walker@wsj.com
(END) Dow Jones Newswires
January 11, 2017 16:02 ET (21:02 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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