Column: Trump had wanted Canada to raise its drug prices. Now he wants us to shop there
President Trump would prefer that you think he’s working tirelessly to protect Americans from soaring drug prices.
His administration announced this week it wants to create a system that allows people to legally access lower-cost prescription meds from Canada.
“For too long American patients have been paying exorbitantly high prices for prescription drugs that are made available to other countries at lower prices,” said Health and Human Services Secretary Alex Azar.
He called this “the next important step” in the administration’s efforts to “put American patients first.”
OK, two things.
First, this is a good idea, one that’s been championed by Democrats for years. This “next important step” from Trump is him embracing the left’s common-sense policy goals because his own proposals have gotten nowhere.
Second, who does he think he’s kidding?
Until this week, Trump has advocated not giving Americans access to cheaper drugs from abroad but forcing other countries to raise their own pharmaceutical prices.
In May 2018, Trump issued a “blueprint” for lowering drug prices. It said that “other countries use socialized healthcare to command unfairly low prices from U.S. drug makers.”
Trump said it was “ridiculous” that “their medicine is a tiny fraction of what the medicine costs in the USA.” The implication was that people in other countries should be paying as much as Americans.
Now the president has reversed course and essentially said Americans should be entitled to the same reasonable prices that Canadians pay.
Presumably we also should be paying the same as the British, French, Germans, Japanese and people in other developed countries that actively work to prevent pharmaceutical price-gouging.
Azar, who last year dismissed drug imports as a “gimmick,” told reporters Wednesday that Trump has always favored the idea, which he hasn’t, and that the president has been pressuring government officials to take action.
“He is always pushing me, challenging me to find more solutions to help the American patient,” Azar said.
The willingness of this administration to indulge in fantasy never fails to impress.
Healthcare experts I spoke with after the administration’s announcement said that while drug imports from Canada could be effective, it won’t take long for the pharmaceutical industry to figure out ways to fleece people in both countries.
“I feel sorry for the Canadians,” said David Dranove, a professor of health industry management at Northwestern University. “Once borders are free, the law of one price applies. And I doubt whether drugmakers will choose the Canadian price.”
Or if they do continue selling their products north of the border at fair prices, they’ll tighten supplies so there aren’t enough drugs left for pesky Americans to purchase at a discount.
“Do you expect the branded suppliers will ship more product to Canada than the Canadian demand requires?” asked William Comanor, a professor of health policy and management at UCLA. “Are the companies stupid?”
Greedy, yes. Stupid, no.
“Drug manufacturers are going to make it difficult for Canada to subsidize our drugs,” said Stacie B. Dusetzina, an associate professor of health policy at Vanderbilt University.
In fact, the industry wasted no time in voicing its opposition to the administration’s plan, which at this point has no time frame for implementation.
Stephen J. Ubl, head of Pharmaceutical Research and Manufacturers of America, an industry group, said the proposal is “far too dangerous for American patients.”
“There is no way to guarantee the safety of drugs that come into the country from outside the United States’ gold-standard supply chain,” he said. “Drugs coming through Canada could have originated from anywhere in the world and may not have undergone stringent review by the FDA.”
This is, of course, a bogus argument. It’s predicated on the idea that Canadian officials have less-stringent safety standards than their U.S. counterparts, which should be insulting to all our friends in the Great White North.
As James Villeneuve, Canada’s former consul general in Los Angeles, told me a year ago, “Our regulatory standards are as high as anything in your country. All imported drugs are regulated and reviewed before reaching the public.”
What U.S. drugmakers are worried about isn’t endangering American patients. It’s endangering American profits.
For all his bluster about the pharmaceutical industry “getting away with murder,” Trump has consistently backed off from any plan to lower drug prices that would displease corporate donors.
While the industry typically plays both sides of the political fence, it routinely contributes more to Republican causes than Democratic. PhRMA, the industry group, last year spent about $28 million on lobbying.
If Trump really wants to show he’s serious about lowering drug prices, he should get behind another core Democratic proposal — empowering Medicare to negotiate drug prices.
Yes, this would represent that exact same “socialized healthcare” that Trump and other Republicans rail against. But it’s also precisely why the Canadians and others aren’t systematically swindled by drugmakers.
To date, Republican lawmakers have blocked all attempts to unshackle Medicare and allow it to flex its market muscle on behalf of its 60 million beneficiaries.
PhRMA’s Ubl said that “rather than surrender the safety of Americans by importing failed polices from single-payer countries, we should work on solutions here at home that would lower patient out-of-pocket costs at the pharmacy counter.”
Because, you know, that’s worked out really well so far.
What we should actually do is implement policies that we know will work — policies that have been tested and perfected by our economic peers.
Trump talks a good game when it comes to drug prices. But that’s all it’s been. Talk.
Which is to say, a gimmick.
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