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What Does the 2016 US Election Mean For Pharma?
Posted on June 28th, 2016 by Betsy Davis in Pharma R&D
With summer, the 2016 U.S. Presidential Election is now truly heating up as we have presumptive nominees from the two major political parties. While we are hearing a lot about issues like national security and immigration from Republican nominee Donald Trump and Democratic nominee Hillary Clinton, those working in the pharmaceutical industry may be wondering how their sector will be affected by the eventual winner.
Clinton Targets Ads, Encourages R&D Investment
Although Hillary Clinton has never been considered a friend of Big Pharma, a look at the numbers shows that the industry has been trying to get on her good side with campaign contributions. CNN reported that, in 2015, “she collected $336,416 in donations, over a third of the total contributions during the 2016 presidential campaign.” Meanwhile, of the other candidates reviewed, Trump had received the fewest donations from pharma.
However, Secretary Clinton has insisted she doesn’t let money dictate her policy decisions, and where healthcare is concerned, that may indeed be the case. The Clinton campaign website has a fact sheet detailing her proposal to lower drug costs, which summarizes it like this:
“Her plan will demand a stop to excessive profiteering and marketing by denying tax breaks for direct-to-consumer advertising and demanding that drug companies invest in R&D in exchange for taxpayer support – rather than marketing or excessive profits. She will encourage competition to get more generics on the market and create a Federal backstop for when there are excessively high-priced drugs that face no competition.”
When Clinton announced her proposal last autumn, the New York Times published a piece by Margot Sanger-Katz reporting that a number of health policy experts were skeptical that her plan – which would link prices directly to the amount of money being spend on R&D – would work. Some said the plan fails to acknowledge the diversity of the industry, which ranges from small biotech firms focusing on developing one drug to companies that specialize in getting drugs to market. “Critics worry that drug companies might instead stick with their prices and then pour more money into new forms of research, even if they don’t have good ideas or won’t provide much public benefit with the work,” writes Sanger-Katz.
Trump Wants to Remove Borders (For Drugs)
So how about Donald Trump? The seven-point health plan listed on the Trump campaign website emphasizes repealing Obamacare first, then also mentions the idea often cited by Republicans of creating more competition by allowing health insurance to be sold across state lines. The other points include allowing individuals to fully deduct health insurance premium payments, using Health Savings Accounts, requiring price transparency from providers, offering block-grant Medicaid to states, and removing barriers to entry in the market for “drug providers that offer safe, reliable and cheaper products”.
On that last point, there’s more: “Congress will need the courage to step away from the special interests and do what is right for America. Though the pharmaceutical industry is in the private sector, drug companies provide a public service. Allowing consumers access to imported, safe and dependable drugs from overseas will bring more options to consumers.”
It’s that seventh point that will probably make Trump least popular with Big Pharma. “Drug reimportation isn’t exclusively a Democratic idea,” says David Nather of STAT, noting its support from John McCain in 2008, “But it’s not an idea that wins the votes of most Republican lawmakers, and it is bitterly opposed by the pharmaceutical industry.”
Trump has also raised industry eyebrows with remarks like those reported by Reuters in January 2016, when he said Medicare could save hundreds of billions by negotiating with drug makers. “We don’t do it. Why?” Trump was quoted as saying. “Because of the drug companies.”
Moving Forward Amidst Criticism From Both Sides
The idea that both major party candidates might be taking shots at the industry is bound to be intimidating to pharmaceutical firms. But it’s easy to see why this is the case, given where people’s concerns are right now. Politico reported last year that “recent polls have found that high drugs costs are the No. 1 health care priority of Americans, eclipsing Obamacare even among Republicans and independents.”
JK Wall of The Health Care Blog advises that pharma takes this bipartisan focus on drug pricing to heart and starts considering for itself ways to help patients afford medicines. “If drug companies voluntarily removed the sting off their high-cost medicines for both poor and working-class Americans,” suggests Wall, “they’d likely be accomplishing both their missions: promoting health and promoting profits—because they would fix a problem before public outcry makes politicians do it for them.”
All opinions shared in this post are the author’s own.
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