Watchdog Group Slams Trump for Drug Price Controls, Reimportation

For Immediate Release
July 24, 2020
Contact: Grace Morgan
(202-855-4380)

WASHINGTON, D.C. – Today, the Taxpayers Protection Alliance (TPA) criticized President Trump for announcing successive executive orders enacting onerous pharmaceutical price controls and allowing for drug reimportation. This price control policy, known as the “international pricing index” and now being rebranded as a “most favored nation” proposal, will tether Medicare Part B drug payments to an international average of artificially low prices paid by other governments across the developed world. In previous decades, these low prices imposed by other countries have led to medication shortages, diminished drug production, and less access for patients. Meanwhile, President Trump’s push for the reimportation of medications from Canada has encountered opposition from leading American and Canadian health experts, who have highlighted the drawbacks and dangers of this policy.

TPA President David Williams expressed alarm over these executive orders, noting, “during this difficult time, patients are relying on continued medical research and innovation. But, the race to bring life-saving drugs to market will come to a screeching halt if these disastrous policies are implemented. Tethering drug prices to the low rates imposed by socialistic European governments will reduce patient access to cutting-edge medications and lead to cutbacks in efforts to find a cure for COVID-19. Meanwhile, allowing for drug reimportation will make the problem even worse by diminishing intellectual property (IP) protections and drying up the pipeline of promising drugs. America cannot afford this one-two punch that would undermine innovation and stymie much-needed medical research.”

Williams continued: “President Trump’s pricing proposal would have the federal government look to European countries to figure out ‘fair’ prices for leading medications. But Europe’s 50-year experiment with price-fixing has led to an exodus from the continent by leading drug manufacturers. Since the 1970s, the share of new medications originating in countries such as Germany, France, and the U.K. has halved as companies sought refuge in the U.S. And European consumers have paid the price in the form of chronic shortages of life-saving medications such as statins. American consumers would suffer a similar fate if U.S. policymakers import these price controls.”

Williams concluded: “Fortunately, there’s a far better alternative that would avoid harming vulnerable patients through price controls and weakened IP protections. The average medication costs more than $2 billion to bring to market, thanks to needless rules promulgated by the Food and Drug Administration. Relaxing these rules would give patients more options at affordable prices. Cures for deadly diseases such as COVID-19 will only come through regulatory reforms and private sector innovation, not federal fiat.”

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