Administration Presents Plans To Lower Drug Prices

Author:Ms Melissa K. Bianchi, Ken Choe, Alice Valder Curran, Elizabeth (Beth) Halpern, Sheree R. Kanner, Stuart M. Langbein, Beth L. Roberts, Christopher H. Schott, Samantha D. Marshall and Lacey Withington
Profession:Hogan Lovells

Mix of general and specific, with promises of more to come Likelihood, timing of implementation unclear Request for public comment on many topics On May 11, 2018, President Trump and Department of Health and Human Services (HHS) Secretary Alex Azar delivered highly anticipated speeches regarding the Administration's plan to reduce drug prices. Concurrently with the speeches, the White House issued a Fact Sheet summarizing the plan, and HHS published the President's Blueprint for reducing drug prices. As detailed below, the Blueprint sets forth a list of administrative actions the Administration is considering and seeks comments from stakeholders on a broad range of topics. It is important to review the Blueprint in detail to identify areas for comment or consideration that may be relevant to your organization. Comments will be due 60 days from the date the Blueprint is published in the Federal Register, which is expected to occur on May 16, 2018. As such, comments are expected to be due on Monday, July 16, 2018. The Blueprint identifies the following challenges in the American pharmaceutical market:

"High list prices for drugs"; "Seniors and government programs overpaying for drugs due to lack of the latest negotiation tools"; "High and rising out-of-pocket costs for consumers"; and "Foreign governments freeloading off of American investment and innovation." To address these challenges, the Blueprint says that "President Trump has called on the Administration to propose new strategies to take bold actions to

Improve competition and end the gaming of regulatory processes, Support better negotiation of drug discounts through government insurance programs, Create incentives for pharmaceutical companies to lower list prices, and Reduce consumer out-of-pocket spending at the pharmacy and other care settings." The President first announced legislative and administrative proposals to implement these four strategies in his Fiscal Year (FY) 2019 Budget, which we addressed in a February 2018 client alert. The Blueprint identifies steps the Administration is considering to build on the FY 2019 Budget proposals and implement each strategy. They are:

Improved competition: HHS may support improved competition by "[t]aking steps to prevent gaming of regulatory processes" and "[p]romoting innovation and competition for biologics." Such steps may include: FDA "issu[ing] guidance to address some of the ways in which manufacturers may seek...

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