GOVERNMENT RELATIONS AND PUBLIC POLICY

President Trump Releases Drug Pricing Blueprint

By Sheila Burke, Niki Carelli, Tiffani Williams, Jeff Davis, and Amit Rao

On Friday, May 11, President Donald Trump and Department of Health and Human Services (HHS) Secretary Alex Azar presented the Administration’s long-awaited plan to address drug pricing. The proposed framework, entitled, “American Patients First: The Trump Administration Blueprint to Lower Drug Prices and Reduce Out-of-Pocket Costs” aims to achieve four goals:

  • Increase competition for generic and biosimilar drugs;
  • Improve drug price negotiation in Medicare Part B and Part D;
  • Provide incentives for drug manufacturers to lower list prices; and
  • Reduce consumer out-of-pocket spending.

While the blueprint is fairly high-level and will require additional administrative and congressional action over time to implement, the proposed plan represents a pivotal step in the drug pricing debate and opens the door for stakeholders to weigh-in on the proposed policies. To that end, on May 14, HHS issued a Request for Information (RFI) on dozens of drug pricing proposals with a 60-day comment period.

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HHS Solicits Comments on Possible 340B Program Changes to Reduce Drug Prices

By Jeff Davis, Sheila Burke, and Amit Rao

The Department of Health and Human Services (HHS) is soliciting comments from the public on the Administration’s proposals to reduce drug prices and is targeting the 340B drug pricing program as an area of focus. The 340B program requires drug manufacturers to sell outpatient drugs at discounted rates to certain public and non-profit hospitals that treat high volumes of low-income patients or are located in rural areas and other safety net providers that receive federal grant funding.

On May 14, 2018, HHS issued a request for information (RFI) to help the agency develop future policies to address high drug prices. HHS will formally publish the RFI in the Federal Register on May 16, 2018 and will allow 60 days for comments. The RFI largely mirrors the Administration’s blueprint issued last week in conjunction with President Trump’s speech on drug prices. See Baker Donelson’s Summary of Trump Administration Drug Pricing Blueprint.

The blueprint questioned whether growth in the 340B program has contributed to higher drug prices, stating that the “additional billions of dollars in discounted sales and the cross-subsidization necessary may have created additional pressure on manufacturers to increase list price[s].” President Trump also alluded to the 340B program in his speech, mentioning that his administration “reformed the Drug Discount Program for safety net hospitals to save senior citizens hundreds of millions of dollars on drugs this year alone.”

The RFI outlines actions the Administration may take to address high drug prices and poses questions related to other actions under consideration. HHS includes a discussion of the 340B program in the section listing other actions under review. Below is a summary of the questions raised related to 340B.

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About the Authors

Sheila P. Burke
Washington, D.C.
202.508.3457
sburke@bakerdonelson.com

Nicole D. Carelli
Washington, D.C.
202.508.3451
niki@daschlegroup.com

Tiffani V. Williams
Washington, D.C.
202.508.3428
tiffani@daschlegroup.com

Jeffrey I. Davis
Washington, D.C.
202.508.3414
jeffdavis@bakerdonelson.com

Amit Rao
Washington, D.C.
202.508.3472
arao@bakerdonelson.com

www.bakerdonelson.com