Trump Strangles Pharmaceutical Industry as It Draws Closer to COVID-19 Treatments

In his State of the Union Address, President Trump said, “We will never let socialism destroy American healthcare.” 

Yet, just as pharmaceutical companies are starting to announce big breakthroughs in the quest to develop a COVID-19 vaccine, the president is pushing a plan that promises to bring socialized medicine to the United States.

In September, the president signed and released a “Most Favored Nations” Executive Order regarding prescription drugs covered under Medicare that imports socialism into American healthcare. He continues to push for it, even now, when all it would do is leave him with a negative, anti-innovation legacy of price controls.

The president’s executive order effectively ties Medicare Part B reimbursements for medicines to the prices paid in foreign countries—what the president is calling the most-favored nation price.

The problem is that almost all the “most-favored” nations feature single-payer healthcare markets that are warped by socialist price controls. In the 1980s and 1990s, before instituting social price controls, European nations led the world in biopharmaceutical innovation; by the late 1990s, when Europe instituted anti-innovation policies, the United States overtook Europe as the leader. Why would we want to follow in Europe’s path and hamstring our own drug innovators, our own health, and our own economy?

The president’s executive order would make sweeping changes to the drug and biological supply chain in America and would have implications for manufacturers and distributors of lifesaving drugs, as well as for group purchasing organizations, hospitals, and physician clinics, among others.

Implementing the president’s executive order would dampen the financial incentive for researchers to engage in the research and development of new treatments at a time when we need them the most. It should be obvious that importing socialist price controls is inconsistent with producing new medicines in an environment of increasing research and development costs. A reduction of $2.6 billion in available R&D funding is estimated to result in one less new drug being developed.

Just as an example, 95 percent of new cancer drugs are available in the United States; only 55 percent are available in countries the Trump Administration itself has examined. Moreover, the average lag between the time cancer drugs are available in the United States compared to elsewhere is 17 months.

So, while for his entire presidency, he has railed against China for stealing American intellectual property, President Trump’s Most Favored Nations Executive Order effectively represents an “inside job” to burglarize the intellectual property of our own domestic pharmaceutical companies and to steal hope from patients waiting for lifesaving drugs to be developed.

The bottom line: Socialist price controls are harmful to patients and harmful to the American economy.

As Americans, we are accustomed to receiving excellent healthcare and have strived to build a better healthcare system than those that exist in foreign countries, where under socialist systems people suffer without proper medications and too often die early because they lack life-saving medicines.

The president’s executive order is a betrayal of American scientists who develop miracle cures and a betrayal of Americans who need life-saving medicines. At this very moment, when pharmaceutical companies are starting to announce highly anticipated protections against COVID-19, we should not be putting our country’s healthcare future or our innovation economy at risk.