HHS: Feds will push for drug negotiation after all

Share this content:

Though President Donald Trump's drug blueprint glossed over drug price negotiations, Health and Human Services Secretary Alex Azar said Monday morning that changes are on the horizon.

Trump campaigned on lowering drug prices, but the blueprint he unveiled Friday left the government out of that effort.

Azar said during his follow-up speech in Washington, D.C., that Trump wants tougher negotiation, starting with an alternative system for buying Medicare Part B drugs. The Secretary said one proposal is to allow private sector payers to negotiate prices for those drugs, as they already do for Medicare Part D prescriptions available at pharmacies.

"You can imagine what happens when you're developing a drug: It's much more appealing for the drug to go into Part B, where the government just pays the bill you send them, than Part D,” Azar said. “In short order, we will be issuing a request for proposal to make new use of an alternative system for buying Part B drugs, a Competitive Acquisition Program. We believe there are more private sector entities equipped to negotiate these better deals in Part B, and we want to let them do it. More broadly, the president has called for me to merge Medicare Part B into Part D, where negotiation has been so successful."

In the interim, Azar added, HHS would move to make negotiation more effective within Part D.

“I know the tired talking points: the idea that if one penny disappears from pharma profit margins, American innovation will grind to a halt,” said Azar, a former pharmaceutical executive. “I'm not interested in hearing those talking points anymore, and neither is the president."

Drugmaker shares rose for a second day on Monday, Reuters reported, with analysts predicting the policies included in the president's 44-page blueprint would not cut significantly into profits.