Drugs in this country cost too darn much. Trump knows it, Americans know it, and yet Big Pharma refuses to budge.
This summer, President Trump threatened heavy action against major drugmakers unless they commit to lowering their U.S. prices to what they charge other nations. Yet, thus far, the industry has refused (except for one company, which committed in late September). That’s a slap in the face to the American people, who already subsidize this industry’s profits more than any nation on earth.
Other countries impose price controls on prescription drugs, so manufacturers make up the difference by charging Americans several times more. Trump called this out for what it is — a shell game at America’s expense — and told the industry to knock it off.
Instead, days ago, PhRMA — the trade group representing much of the industry — dodged the issue entirely, touting vague promises of new investments and programs as its interpretation of “answering President Trump’s call” rather than pledging to cut prices like he demanded.
Trump is a smart guy. He won’t be fooled by these dodge tactics. And since the drugmakers have refused to comply, now it’s time for him to do exactly as he threatened in his letters to them by “deploy[ing] every tool in [the federal government’s] arsenal to protect American families from continued abusive drug pricing practices.”
Fortunately, his administration already anticipated this noncompliance. A spring executive order that the president signed directs Attorney General Pam Bondi and Federal Trade Commission Chair Andrew Ferguson to “undertake enforcement action against any anti-competitive practices identified within such report.” And there’s no better time than the present.
Many of the largest drugmakers have relied on “patent thickets” to get ahead in the marketplace. This is the process by which they stack dozens of overlapping patents on the same medicine to block rivals from introducing cheaper versions. Others have used crony petitions to the Food and Drug Administration to achieve this aim or conspired with other drug companies with handshake agreements to raise their list prices.
Under Section 2 of the Sherman Act, such tactics can qualify as unlawful maintenance of monopoly power — exclusionary conduct that serves no legitimate purpose other than keeping prices high. The nations’ antitrust officials have prosecuted similar behavior in other industries; there’s no reason they can’t do so here.
The Trump administration should also resist the temptation to let Big Pharma shift blame elsewhere. It can do this by settling the Biden FTC’s lawsuit against the drugmakers’ biggest foil, pharmacy benefit managers (PBMs).
PBMs are the negotiators employers and insurers hire to secure lower prices from Big Pharma. They are not perfect, but employers and insurers wouldn’t be paying them, and Big Pharma wouldn’t be attacking them, if they weren’t effective. That is why, in the DOJ and FTC’s Lowering Americans’ Drug Prices Through Competition listening session this July, Vanderbilt University health-policy professor Stacie Dusetzina told the Trump administration that, “without PBMs, it is likely Americans would pay more for their medications than they currently do.”
By Chair Ferguson’s own admission, the Biden-era attacks on PBMs were far from flawless. The Trump administration should work toward a fair settlement — one that reins in any truly harmful PBM behavior while preserving PBMs’ ability to keep pressure on drug manufacturers. This would put American patients, as opposed to Big Pharma, first.
When push comes to shove, the administration must turn the full weight of federal enforcement back where it belongs — on the drugmakers themselves. These companies openly ignored Trump’s call to lower prices. And they continue to gouge U.S. consumers and give sweetheart deals to foreign governments. If they won’t change their tune voluntarily, the DOJ and FTC should make them act through aggressive, lawful antitrust enforcement. Americans deserve the same prices these firms charge elsewhere. They shouldn’t have to pay three times more than the rest of the world for the same medicines.
If Trump’s first term taught Washington anything, it’s that when he says he’ll take on entrenched interests, he means it. Big Pharma had its chance to do the right thing. Now it’s time for the DOJ and FTC to make sure they do.
John M. Pierce, a trial attorney and Managing Partner of John Pierce Law, is the founder of the National Constitutional Law Union (NCLU), where he defends Americans against government overreach and Big Tech tyranny. He has represented high-profile clients including Tulsi Gabbard, Rudy Giuliani, and over 50 January 6 defendants.
The views and opinions expressed in this commentary are those of the author and do not reflect the official position of the Daily Caller News Foundation.
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