Trump promises lower drug prices, but drops populist solutions

President Trump vowed on Friday to "bring soaring drug prices back down to earth" by promoting competition among pharmaceutical companies, but he dropped the proposals of his presidential campaign, deciding not to have the federal government directly negotiate lower drug prices for Medicare. He also opted not to allow American consumers to import low-cost medicines from abroad. Trump said he would instead give private entities more tools to negotiate better deals on behalf of consumers, insurers and employers. He also suggested that the government could require drugmakers to disclose prices in their television advertising. Ronny Gal, a securities analyst at Sanford C. Bernstein & Company, said the president's speech was "very, very positive to pharma. Shares of several major drug and biotech companies rose immediately after the speech, as did the stocks of PBMs. Alex M. Azar II, the secretary of HHS, said the government will consider whether to "outlaw rebates." The administration would lower out-of-pocket costs for Medicare patients by requiring prescription drug plans to pass on some of the discounts and rebates they receive from drug manufacturers. Patients could see those savings at the pharmacy counter. At the same time, Medicare officials say, there could be a modest increase in premiums for Medicare drug coverage.

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