- Six top pharmaceuticals executives and the head of the powerful lobbying group PhRMA sat down with President Donald Trump Tuesday morning to discuss the new administration's plans for the industry.
- As markets watched with bated breath, Trump told the room he wanted to remove regulations, lower drug prices, bring on tax reform and move manufacturing back the U.S.
- In a statement after the meeting, PhRMA CEO Stephen Ubl called the meeting "positive" and "productive," saying the group talked about "how we can work together to improve American competitiveness around the world."
While at first glance the meeting seemed like a positive signal for an industry still shell shocked by pricing backlash, the major changes that the new President is talking about could create some major challenges.
The first challenge — lowering drug prices.
"You folks have done a terrific job over the years, but we have to get prices down for a lot of reasons. We have no choice," said Trump, who indicated that he wanted to follow through with his promises of tax reform that could help pharma companies repatriate foreign cash.
"We're going to be ending global freeloading. Foreign price controls reduce the resources of American drug companies to finance drug and R&D innovation," he said.
"Our trade policy will prioritize that foreign countries pay their fair share for U.S.-manufactured drugs so our drug companies have greater financial resources to accelerate the development of new cures."
Prices on drugs in the U.S. tend to be higher than other places in the world due to pricing controls in other countries, even as much of the innovation flows from multi-national companies based in the U.S.
The second challenge — moving manufacturing.
Continuing his crusade to move jobs back to the U.S. and stop other jobs from leaving, Trump told the group that pharma companies would not be exempt from this.
"So what I want, is we have to get lower prices, we have to get even better innovation and I want you to move your companies back to the United States. I want you to manufacture in the United States," said the President.
The third challenge — drug standards.
The last major talking point of the meeting was deregulation. Trump appears to be planning to strip away power from the Food and Drug Administration. His most recent executive order, which authorizes taking away two regulations for every new one approved, could hamper FDA efforts to judge drug safety and efficacy as well as make it difficult to implement the recently passed 21st Century Cures Act.
"We're gonna (sic) streamline the FDA. We have a fantastic person that I think I'll be naming fairly soon who's gonna streamline the FDA and you're gonna get your products either approved or not approved, but it's gonna be a quick process. It's not gonna take 15 years," said Trump.
The President said he is "disturbed" by the FDA not approving drugs that have not been tested, despite there being terminally ill patients — a scenario that sounded more suited to a nighttime television drama than real life.
Ultimately, Trump’s effort to lower standards at the FDA, while speeding approval timelines, could mean the market gets flooded with medications that are unsafe, ineffective, or both — further eroding patient trust in the industry.
Meeting participants included Eli Lilly CEO David Ricks, Amgen CEO Bob Bradway, Merck & Co. CEO Ken Frazier, Novartis CEO Joe Jimenez, Celgene CEO Bob Hugin and Johnson & Johnson’s Joaquin Duato.