(Photo illustration by Bill Kuchman/The Bulwark | Photos: Getty, Shutterstock)
KATIE ZACHARIA’S DEBUT as White House press secretary came in for some rough reviews on Tuesday. But she proved she’s got what it takes to perform at least one of her essential tasks: making absurd, wildly misleading statements about Donald Trump’s record, especially when it comes to health care.
“President Trump is the first president in modern history to actually lower prescription drug prices,” Zacharia said, “delivering the biggest drop in sixty-three years.”
Zacharia was referring to news over the summer that drug prices had fallen by 3.1 percent over the previous year, the largest decline in six decades—and asserting that Trump had caused this by negotiating deals with individual pharmaceutical companies and then creating a website, TrumpRx, where people buying drugs could get coupons to buy some of their products.
If the claim sounds familiar, that’s because Trump himself has been making it for a while, including during this year’s State of the Union address when he declared, “Other presidents tried to do it, but they never could. . . . I got it done.”
But the boast has extra political significance now, less than a month before the midterms, because it has figured prominently in the campaigns of Republicans like Roger Marshall, the incumbent Kansas senator battling for his seat, who earlier this year called Trump’s actions on prescription drugs “the biggest game changer this year for the cost of health care.”
Other embattled Republicans touting Trump’s record on prescription drugs include Jon Husted, the incumbent senator seeking to retain his seat in Ohio, and Mike Rogers, the former congressman now running for Michigan’s open Senate seat.
The challenge facing GOP candidates like Marshall, Husted, and Rogers is that voters are angry about the high cost of living, which Trump promised to bring down. And the price of health care is right at the top of their list of concerns, maybe even above gas prices.
Worse still, the Republican record includes a trillion dollars they took out of Medicaid to finance tax cuts—and, then, a refusal to renew a set of temporary, extra subsidies for Affordable Care Act coverage. That refusal made insurance more expensive for roughly 20 million people. Both decisions probably help explain why polls keep finding Democrats have a massive advantage on health care.
If so, then one way Republicans can push back is to convince voters Trump has made meaningful headway on prescription drug prices. But there’s little reason to think he has, and even less reason to think he’s done more than his predecessors—including Joe Biden, who, as it happens, actually does have a claim to have made progress on drug pricing. And although the administration had been taking some steps to build on Biden’s progress, it now appears to have backed off that effort, leaving Trump with the same flimsy record as before.
TRUMP’S DEALS WITH THE DRUG COMPANIES have received much hype, with Trump bringing in the CEOs for the signing ceremonies. At those events, and in many other public remarks and social media posts, Trump has claimed the agreements mean that Americans now pay the same low prices for their drugs that the citizens of peer countries around the world do.
“Americans deserve the best health care in the world, and we’re now getting the best health care at the lowest price,” Trump said in the Oval Office last November, while standing alongside CEOs for Eli Lilly and Novo Nordisk.
Trump’s desire to match the prices makes sense given his belief that Americans are constantly getting screwed by other countries. And Trump was correct to observe that Americans pay more for name-brand pharmaceuticals than the citizens of other countries, though it’s not because those other governments are screwing Americans. It’s because those governments negotiate prices directly with manufacturers.
Would-be reformers in the United States have talked for decades about giving the federal government that sort of power. But proposals to do so kept stalling, in part because of opposition from conservatives who believed state-backed negotiation would distort market forces and stunt innovation—and in part because the pharmaceutical industry, correctly perceiving negotiation as a threat to its bottom line, used its considerable political influence to stop legislation from advancing.
Trump during his first term promised to beat the drug companies into submission, touting his willingness to confront them as one of the ways he was different from the old, business-friendly Republican establishment. And he got a chance to follow through when House Democrats, after getting control of the chamber in 2019, passed a bill that would have let the federal government negotiate prices with drugmakers for certain drugs. But instead of getting behind the legislation or some variant of it, Trump backed off, allowing his GOP allies who were still in control of the Senate to kill the bill.
Democrats got a chance to take action on their own two years later, once they had control of the Senate and White House as well. In 2022, they enacted the Inflation Reduction Act, which included several provisions giving the federal government new power to curb drug prices.
The provisions were a lot weaker than party leaders had hoped: With no votes to spare in the Senate, and one member of the caucus (Kyrsten Sinema of Arizona) opposed to robust action, Democrats had to water down the bill—which, among other things, limited government negotiating power to only the Medicare program. But those Biden-era negotiations are now moving forward, and have brought down the prices of several name-brand drugs for treating diabetes, high blood pressure, and other conditions. One government estimate, cited by the AARP Public Policy Institute, has suggested the negotiations will end up saving beneficiaries about $1.5 billion in out-of-pocket costs this year.
That’s real money but, obviously, not nearly enough to make drug costs affordable for all or even most Americans. That deficiency is what Trump said he would address by finally bringing down drug prices through the individual deals he reached with the drug companies.
NOW THAT THERE ARE SIGNS drug prices have dropped in the last year, Trump and his new press secretary—and all those campaigning Republicans—are saying it was their doing. But it’s not entirely clear how much drug prices have actually fallen. As STAT columnist Ed Silverman was quick to point out, the official Consumer Price Index for pharmaceuticals captures only part of the market, and doesn’t account for all of the complex rebates and backpayments that circulate among manufacturers, various middlemen, and consumers.
Then there’s all the mystery about Trump’s deals with manufacturers. The terms are confidential. And to the extent the administration has revealed the details, it has said that those low, supposedly European-equivalent prices for drugs already on the market apply mainly to Medicaid, which by law already gets deep discounts. The deals have some other provisions, including lower prices on GLP-1 drugs, but most of those are missing so many details it’s hard to say what kind of savings they really produce.
In September, the watchdog organization Public Citizen published an analysis of two agreements it was able to obtain via public-records requests from the Department of Health and Human Services. Despite extensive redactions that hid many of the most important details, Public Citizen was able to determine that the drugmakers had won exemptions from other initiatives to reduce drug prices, partly or totally offsetting whatever savings the agreements actually produce. Public Citizen also confirmed what previous reporting in STAT had found: The deals expire when Trump leaves office.
“The bottom line is that the president gets to make big claims about reducing drug prices without the evidence to support those claims,” Ian Spatz, founder and principal of Rock Creek Policy Group, told me over e-mail.
Spatz, who has deep experience with the pharmaceutical industry and with politicians, said he is accustomed to elected officials exaggerating the impact of their accomplishments. That includes champions of the Biden-era reforms, whose true effects he thinks remain highly ambiguous. But he went on to say even he’s been taken aback at how Trump “is willing to claim things (e.g., I have negotiated the lowest prices in the world) that are demonstrably untrue and to repeat them over and over.”
One reason to doubt Trump’s deals have meaningfully made a difference on drug costs is the actual offerings on TrumpRx, the new government-run website where—according to Trump—consumers can see and take advantage of these newly low prices directly.
An analysis of thirty-two of the drugs by the health policy research organization KFF found that, while the website’s prices were lower than the average price abroad in seventeen instances, they were higher in fifteen. And while there were five drugs for which the TrumpRx price was the lowest studied, there were thirteen for which it was the highest.
Keep in mind that those are just the figures for drugs on TrumpRx—which, in turn, represent a tiny fraction of all the prescription drugs sold in the United States. “Like many of the Trump administration’s drug-pricing promises, the reality falls short of the rhetoric,” Larry Levitt, KFF’s executive vice president for health policy, told me over e-mail.
IRONICALLY, THE TRUMP ADMINISTRATION has been pursuing another, genuinely promising initiative on drug pricing, though it has gotten very little attention outside of policy circles and industry trade publications.
It is a pilot program called the Global Benchmark for Efficient Drug Pricing. The acronym more or less works out as GLOBE and, yes, there is a reason for that: The idea behind the pilot is to ensure Americans don’t pay more for their drugs by creating a numerical index based on the prices that other countries’ governments pay after their negotiations, and then linking prices here (with various adjustments) to that index.
The wonky term for this approach is “international reference pricing.” Early iterations of the reforms that ended up in Biden’s Inflation Reduction Act had a version of international reference pricing. Trump in his first term had also tried to introduce a similar pricing strategy, albeit late in his term and with a botched drafting process that made it vulnerable to lawsuits. (The Biden administration ended up pulling it altogether.)
The GLOBE program resurrects the approach, applying it to drugs that physicians and clinics deliver in outpatient settings. (Many cancer drugs work this way, for example.) The administration appears to have taken a more deliberate approach to drafting the proposal this time—checking the appropriate regulatory boxes along the way—so that it stands a better chance of withstanding a lawsuit. Early estimates suggested it could save Medicare nearly $12 billion over the course of seven years.
But that promising assessment was before the Trump administration finalized the proposal, which netted a new estimate—now finding the policy would save only $440 million. The main reason, as Max Bayer of Endpoints first reported over the summer, is that the Trump administration promised that any drug company that agreed to one of Trump’s splashy deals would be exempt from the reference pricing pilot.
In other words, Trump traded potential savings in GLOBE for his deals with the pharmaceutical companies—which, according to multiple analysts, look more like photo ops than genuine progress on prices. And unlike the GLOBE model, which like any formal government regulation has been available for the public to see and inspect, the terms of the drug industry agreements remain mostly secret to this day.
“We don’t know what companies are agreeing to, we don’t know what [the federal government] is agreeing to,” Rachel Sachs, a Washington University law professor and widely cited expert on pharmaceutical issues, told me in a phone interview. “They have taken something out of this more transparent process and put it in this more hidden, opaque process.”
The final changes to GLOBE don’t render it completely useless, as Vanderbilt University health policy professor Stacie Dusentzina noted when I spoke to her this week. “It’s good to have something like this on the table as a potential policy,” said Dusentzina, who recently finished a term on the federal government’s official advisory board for Medicare payment policy. “An administration that wanted to be more aggressive could operationalize this, to affect more drug prices.”
But that would require a White House as interested in action as in spectacle, and more inclined to fight special interests than hold glitzy signing ceremonies with them. There are no signs of those preferences in the Oval Office right now, and evidently not in the press briefing room either.