Yesterday, the Trump administration unveiled a new proposal to substantially reduce the price of certain costly drugs administered under Medicare, by linking what Medicare pays for these drugs to what other industrialized countries pay. It’s a stunning move that could entirely reshape the way the pharmaceutical and biotechnology industries think about their business model.
This difference between what other countries pay for costly, patented drugs and what Americans pay has long irked President Trump. “For decades, other countries have rigged the system so that American patients are charged much more—and in some cases, much, much more—for the exact same drug,” Trump said. “In other words, Americans pay more, so that other countries can pay less.”