The Trump administration will push for a slew of smaller administrative and legislative actions affecting all parts of the pharmaceutical landscape. | Stan Honda/AFP/Getty Images Trump touts plan to lower drug costs but rejects Medicare negotiations

President Donald Trump on Friday will unveil a sweeping strategy for lowering drug prices that aims to reshape Medicare, boost competition and pressure foreign governments that the White House believes are “freeloading” off of the U.S. pharmaceutical industry, two senior administration officials said Thursday night.

The long-awaited plan represents a mix of existing policies laid out in the Trump administration’s 2019 budget blueprint as well as some new ideas designed to drive down drug prices and lower patients’ out-of-pocket costs.


But what the administration officials pitched during a call with reporters as “the most comprehensive” drug price plan in presidential history will stop short of radically overhauling the health care system by allowing Medicare to directly negotiate with drug makers — a step that Trump once endorsed on the campaign trail but later backed off.

“We are talking about something different,” one senior administration official said. “We’re not calling for Medicare negotiation in the way Democrats have called for.”

Instead, the Trump administration will push for a slew of smaller administrative and legislative actions affecting all parts of the pharmaceutical landscape, floating a series of reforms to Medicare that officials said will allow the government to secure lower prices and reduce incentives for doctors to prescribe high-cost medications.

That includes proposals offering free generic drugs to seniors, requiring Medicare Part D plans to pass along a certain portion of drug rebates to patients and capping certain out-of-pocket costs for Medicare Part D beneficiaries.

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The White House will release the full details when Trump gives his long-awaited speech on drugs at the White House Friday at 2 p.m. Eastern. Trump will also move to rein in what his administration has characterized as “foreign freeloaders” — or first-world countries that use government controls or negotiations to hold down their drug costs.

“The U.S. taxpayer, through our publicly funded research efforts as well as through patients and consumers … are largely paying for the vast majority of the R&D that goes into the development of new biologics,” a senior administration official said, lamenting that foreign countries get to “free ride” off of U.S. investment in drug development.

The officials did not detail how they planned to get higher prices overseas, nor how that would in turn bring down the cost of drugs in the U.S. Nor did they detail how the White House proposes to create incentives for greater generic drug competition. One policy that the administration officials floated is closing regulatory loopholes to curb abuse of the FDA’s safety rules and exclusivity periods for branded drugs.

Allen Goldberg, vice president of communications for the Association for Accessible Medicines, the generic drug lobby, said Thursday evening’s preview seems consistent with what the administration had been saying about “emphasizing generic and biosimilar medicines as a key component of any plan to lower drug prices.”

Peter Bach, director of Memorial Sloan Kettering's Center for Health Policy and Outcomes, said he needed to see a lot more detail before he could assess the overall plan but said he was “guardedly optimistic” about the efforts to pass rebates on to consumers.

The administration officials said that the vast majority of the Trump price plan can be carried out through administrative action, rather than relying on Congress to pass legislation. Officials will also put out a request for information Friday seeking broader input on various policy ideas.

Trump has long vowed to crack down on drug prices, criticizing pharmaceutical companies at multiple points for “getting away with murder” and promising to swiftly bring down prices. Nothing much happened in the first year of his presidency, but more recently the effort has fallen largely to HHS Secretary Alex Azar, a former pharmaceutical company executive, who has made drug price policy one of his top priorities since taking office in late January.

“President Trump is delivering on his promise,” one of the senior administration officials said.

Democrats say Trump isn’t going far enough to make a real difference. In a press conference Thursday, Democratic leaders warned that Trump would go easy on the pharmaceutical industry by stopping short of giving Medicare greater negotiating power and focusing on policies that could directly affect drug prices. The blueprint also does not appear to endorse the importation of drug from foreign countries — a step that some Democrats and Sen. Rand Paul (R-Ky.) argue would lower prices but that Azar has rejected in the past.

“Lukewarm pharma-friendly approaches just aren’t going to work,” said Sen. Bernie Sanders (I-Vt.).

Democrats said that the White House never asked them for input on the drug pricing plan.

Rep. Lloyd Doggett (D-Texas) decried the concept of blaming foreign countries for the U.S.’ skyrocketing drug prices — and said higher prices overseas won’t bring down prices for patients in in America.”

But the administration’s top health officials in recent weeks have emphasized the need to reform the entire health care system, arguing that every part of the drug development and delivery chain is to blame.

“A web of rules and restrictions — some implemented as a result of industry lobbying — prevent truly market-based pricing and competition,” FDA Commissioner Scott Gottlieb said in a speech last week.

