Trump's Crusade: Slashing Drug Prices and Squeezing Pharma giants, Especially Europe
United States to Reduce Drug Costs: Trump Intensifies Pressure on European Pharmaceutical Industry - US President Trump pushes for affordable medications domestically - EU under scrutiny for potential price reductions
Venture into the tense world of global politics and pharmaceuticals as Donald J. Trump takes aim at the high drug prices plaguing the United States, casting a sizzling spotlight on Europe. "We're shelling out big bucks for foreign healthcare while Americans suffer under exorbitant prices," Trump barked at the White House during his latest salvo.
Time will tell if Trump's brash measures score a direct hit. A multitude of political and legal obstacles lie in wait, echoing Trump's prior unsuccessful attempts to knock down drug prices during his initial term.
Trump blasts Europe as "more cunning than China"
The sharp-tongued Trump has again rolled out the verbal artillery, taking aim at pharmaceutical companies. "I'm not embarking on the biggest accusations against pharma giants," Trump growled. "Instead, they're often forced to comply under pressure." He launching a scathing attack on European countries, stating American patients are subsidizing "huge welfare systems" à la Germany's. He accused the European Union of engaging in unsavory price negotiations, going so far as to claim they've outsmarted China. Europe will have to dish out more cash, he warned, and the rest of the world will be forced to pay more, except the USA.
In his executive order, Trump trots out the concept of "most favored nation," a principle he attempted to implement during his first term: The USA will no longer cough up more for certain medicines than the country boasting the globe's lowest price, regardless of market size or economic power. "This game is over," Trump declared, shorthanding nations he thinks have milked favorable conditions at the USA's expense.
The pharma sector braces for impact
Trump's announcement has set the pharma sector on edge, with Han Steutel, president of the Association of Research-Based Pharmaceutical Companies (VFA), cautioning that the USA is the moneybag market for innovative meds. "Without the dollars coming in from the States, R&D and new therapies for European patients would often be out of reach," Steutel warned.
With international reference pricing tied to the lowest price, research costs might become unsustainable and market introductions could become increasingly uncertain, Steutel added. The call of the hour, Steutel said, is a strong, coordinated EU drug policy backed by a united marketfront.
Analysts from Simon-Kucher anticipate far-reaching consequences for the global pharma industry and German companies. "A dwindling sales landscape threatens research funding, production, and jobs, even those based in Germany," a study concluded.
As the US sales pie shrinks, companies could face increased pressure to wring higher prices from other affluent nations like Germany. Furthermore, pharma titans might hold off or flat-out avoid the German or European market to steer clear of low price references and safeguard prices in the USA, according to Simon-Kucher.
Trump sets off a series of agencies
For giving Trump's decree legs, several American agencies sit poised to spring into action. The Department of Commerce is gearing up to take on foreign pricing policies viewed as biased against U.S. firms. For instance, state-set maximum prices that disadvantage U.S. companies come under the microscope. The Department of Health and Human Services is set to facilitate direct sales to U.S. consumers at lower prices, where feasible. The Food and Drug Administration (FDA) is also set to scrutinize whether imports from additional industrial nations can be allowed in the future. Export restrictions could also be scrutinized at the White House.
Within 30 days, the Department of Health and Human Services is expected to establish specific targets for price reductions. Based on this, the government will begin negotiations with the pharma industry. If the industry fails to cooperate voluntarily with the government to slash prices, further measures will be considered.
The focus falls on drugs with staggering price differences between the U.S. market and abroad. Specific medications or product groups have yet to be pinpointed. However, the government clarified that there's no intention to cap this to certain drug groups.
A lobby with clout – bipartisan
Trump has labeled the pharma industry as wielding too much political power. He described the lobby as a "Godzilla among lobbies" and claimed that the opposition Democrats have protected the industry for years.
Indeed, the industry remains one of the most influential in Washington. Through strategic donations to both Democrats and Republicans, pharma titans ensure they maintain a strong voice in legislation. Efforts to overhaul and lower drug prices face widespread resistance, often based on arguments about impacting research and innovation.
The cost of medications is a constant hot topic in the USA. Unlike many developed nations, there's no central state price regulation in the States, leaving pricing decisions to pharma companies. This often results in costs significantly higher than in Europe. In Germany, various state control mechanisms are in play.
Keywords:
- Donald Trump
- USA
- Europe
- Pharmaceutical industry
- Medication
- Pharmaceutical company
- U.S. President
- Germany
- Republicans
- China
- Drug price
- EU
- Pharmaceutical industry
- America
- HHS
- FDA
- Donald J. Trump's latest initiative targets high drug prices in the USA, particularly those subsidized by American patients for European healthcare benefits.
- The pharmaceutical sector is bracing for impact as Trump aims to implement the "most favored nation" principle, which would prevent the USA from paying more for certain medicines than the country with the lowest price.
- The European Union, according to Trump, has engaged in dubious price negotiations and overshadowed China in terms of cunningness, a claim that may have significant repercussions for Europe's pharmaceutical industry.
- American agencies, including the Department of Commerce, the Department of Health and Human Services, and the Food and Drug Administration, are preparing to reevaluate foreign pricing policies, export restrictions, and potential import allowances from other industrial nations, with the aim of reducing drug prices in the USA.
