Washington Focus

Executive Order Seeks Better Odds for Competitive Drug Pricing

June 27, 2017 – A draft Executive Order from President Donald J. Trump indicates the administration may seek to “roll back regulations in pursuit of faster drug approvals, promoting drug competition and new payment models for federal health insurance programs,” according to CQ Roll Call.

A CQ Roll Call article stated that some of the items in an Executive Order entitled “Reducing the Cost of Medical Products and Enhancing American Biomedical Innovation,” expected to be released this week, “would benefit pharmaceutical companies, despite [Trump’s] pledge earlier this year to take steps to rein in the industry.”

The draft document calls for the FDA to “take steps to advance innovation and encourage lower-cost alternatives in order to enhance access to safe and effective medical product options for patients.” The draft order states that such actions “shall leverage biomedical discovery, advance the timely development of medical products, increase drug competition, enable generic entry for complex drugs, and address unintended consequences of existing rules that may reduce competition.”

The draft order also asks the Centers for Medicare & Medicaid Services to explore new ways of lowering costs for federal beneficiaries “without decreasing quality,” and requests that the U.S. Trade Representative review the international drug purchasing and supply system and look to reconsider those agreements “that need to be revised to promote greater intellectual property protection and competition in the global market,” as well as identify potential violations of trade agreements.

The draft order further directs the Health Resources and Services Administration to ensure that resources are directed to their intended population and states that the Internal Revenue Service should update the preventative care safe harbor to include services or benefits that help patients adhere to clinical regimens that would reduce the costs of healthcare.

Under general policy of the Executive Branch, the draft order states that it will be the federal government’s goal to “reduce burdens caused by regulatory and administrative actions that inflate or distort prices for beneficiaries of federal health programs.”

CQ Roll Call reports that another document circulating in Washington, D.C., might include provisions that would drug companies to share information with insurance companies about not-yet-approved products or that would change current regulation of off-label promotion.