President Trump is expected to make an announcement Friday about lowering drug prices.
Mr. Trump, who is in a government shutdown standoff with congressional Democrats about Obamacare health care subsidies, will talk about how his administration is lowering the costs of pharmaceutical drugs for Americans.
A week ago, Mr. Trump announced the first agreement with a major pharmaceutical company, Pfizer, to bring down drug prices in the U.S. to the lowest price paid by other developed nations.
That agreement will provide every State Medicaid program in the country access to Most Favored Nation drug prices on Pfizer products.
Americans currently pay for brand-name drugs at more than three times the rate paid in other wealthy countries, namely those in the Organization for Economic Cooperation and Development, even after accounting for discounts manufacturers provide in the U.S., according to government data.
The U.S. also has less than 5% of the world’s population, but about 75% of global pharmaceutical profits come from American taxpayers.
The White House said the Pfizer agreement will produce “millions of dollars in savings” and “strengthen the program for the most vulnerable.”
The deal will also ensure foreign nations can no longer use price controls to “freeride on American innovation by guaranteeing MFN prices on all new innovative medicines Pfizer brings to market,” according to the White House.
Additionally, the agreement requires Pfizer to repatriate increased foreign revenue on existing products that Pfizer realizes as a result of U.S. trade policies for the benefit of American patients.
Presidents from both political parties have long sought to reduce the high-price burden Americans shoulder for prescription drugs.
While drug manufacturers benefit from large research subsidies and massive healthcare spending by the U.S., American consumers do not receive the savings of that benefit.
Instead, drug manufacturers discount their products abroad to gain access to foreign markets and subsidize those discounts through higher prices charged in the U.S., as Americans are subsidizing drug manufacturer profits and foreign health systems, both in development and once the drugs are sold.
Last May, Mr. Trump signed an executive order directing the administration to take numerous actions to bring U.S. drug prices in line with those paid by similar nations.
He sent letters in late July to major pharmaceutical manufacturers, summarizing what they should do to bring down the prices of prescription drugs in the U.S. to match the lowest prices offered in other developed nations.
“In case after case, our citizens pay massively higher prices than other nations pay for the same pill, from the same factory, effectively subsidizing socialism abroad with skyrocketing prices at home,” Mr. Trump said at the time.
“So, we would spend tremendous amounts of money in order to provide inexpensive drugs to another country. And when I say the price is different, you can see some examples where the price is beyond anything — four times, five times different.”
• Kerry Picket can be reached at kpicket@washingtontimes.com.