In a significant move, President Trump recently signed an executive order that could potentially revolutionize the pharmaceutical industry.
The order targets pharmacy benefit managers (PBMs), a sector that has been under scrutiny for its monopolistic practices. The new directive aims to standardize Medicare payments for prescription drugs, effectively eliminating the concept of "specialty pharmacies" that have been monopolized by PBMs.
According to RedState, these specialty pharmacies have been charging exorbitant prices for medications that could be procured at a much lower cost from local independent pharmacies. The report cites examples of generic drugs like Tacrolimus, Sirolimus, and Mycophenolate, which are significantly more expensive at specialty pharmacies. The PBMs, which own these pharmacies, are reimbursed two to three times more than any non-affiliated pharmacy. This practice has been a significant hurdle, especially when discharging patients after procedures like bone marrow transplants.
The executive order is expected to bring about a significant reduction in prescription prices, with estimates suggesting a decrease of up to 60 percent. This will be a welcome relief for patients who have been burdened with high copays, especially for specialty drugs. The report cites an example of a family member who was billed $122,000 for a drug that costs about $14,000 wholesale, with a co-pay of $8790.00.
The Trump executive order also introduces massive discounts for low-income or uninsured patients for life-saving medications. Insulin prices will be lowered to as little as $0.03, and a small administration fee; epinephrine will be lowered to $15.00 plus a small administration fee to the pharmacy. The order also aims to remove formulary development from the PBMs, which will further reduce the cost of drugs.
The executive order has been hailed by many, including Mark Cuban, who tweeted, "Gotta be honest. The @realDonaldTrump EO on healthcare and in particular, drug pricing could save hundreds of billions." The order is expected to face legal challenges, but the prospect of lower drug costs and better access to drugs is a winning issue with Americans. It also promises a lifeline for independently owned pharmacies, which have been struggling in recent years.
The executive order comes at a time when the cost of healthcare has been a significant concern. For instance, California Governor Gavin Newsom recently sought and was granted a $3.4 billion loan to cover the growing cost of the Medi-Cal program, a year after expanding coverage to illegal immigrants.
This executive order represents a significant step towards addressing the monopolistic practices of PBMs and reducing the cost of prescription drugs. It is a testament to the Trump administration's commitment to ensuring affordable healthcare for all Americans. While challenges are expected, the potential benefits of this order make it a significant milestone in the fight against high drug prices.
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