Trump says he's cut drug prices by up to 1,500%. That's not possible

Economic Times

16 hours ago

Synopsis
Donald Trump claimed significant drug price cuts, even up to 1500%. Experts refute this, stating such cuts are impossible. They suggest it would mean people are paid to take medicine. The White House defended Trump, citing price differences with other nations. Trump also mentioned future price drops. Some drugmakers are open to cuts.
AP Days after he sent letters instructing top pharmaceutical manufacturers to use a "most favored nation" pricing model for prescription drugs, President Donald Trump told reporters on Sunday that he had cut costs by up to 1,500%. But Trump's grandiose claim is mathematically impossible. Here's a closer look at the facts. TRUMP: "You know, we've cut drug prices by 1,200, 1,300, 1,400, 1,500%. I don't mean 50%, I mean 14 - 1,500%." THE FACTS: This is false. Cutting drug prices by more than 100% would theoretically mean that people are being paid to take medications. The Trump administration has taken steps to lower prescription drug prices, but experts say there's no indication costs have seen such a massive drop.
Geoffrey Joyce, director of health policy at the University of Southern California's Schaeffer Center, called Trump's claim "total fiction" made up by the Republican president. He agreed that it would amount to drug companies paying customers, rather than the other way around. "I find it really difficult to translate those numbers into some actual estimates that patients would see at the pharmacy counter," said Mariana Socal, an associate professor of health policy and management at Johns Hopkins University who studies the U.S. pharmaceutical market. She added that Trump's math is "really hard to follow." Asked what Trump was using to back up his claim, White House spokesman Kush Desai said: "It's an objective fact that Americans are paying exponentially more for the same exact drugs as people in other developed countries pay, and it's an objective fact that no other Administration has done more to rectify this unfair burden for the American people." The White House provided a chart of price differentials for drugs in the U.S. and comparable countries, but did not offer any other evidence. On Sunday, Trump also described cuts to drug prices as a future development, not that already happened. "So we'll be dropping drug prices," he said. "It will start over the next two to three months by 1,200, 1,300 and even 1,400%." Prices for most prescription drugs - unbranded generics are the exception - are higher in the U.S. than they are in other high-income countries. This is in large part due to the way drug prices are negotiated in the United States. Trump made his recent appeal in letters to 17 pharmaceutical manufacturers, the White House announced last week. He asked them to reduce costs in the U.S. by matching the lowest prices of prescriptions drugs in other comparably developed countries. Some drugmakers have since indicated that they are open to cutting costs. This move follows an executive order Trump signed in May setting a 30-day deadline for drugmakers to electively lower prices in the U.S. or face new limits in the future over what the government will pay. The federal government has the most power to shape the price it pays for drugs covered by Medicare and Medicaid. It's unclear what - if any - impact the Trump administration's efforts will have on millions of Americans who have private health insurance. Socal pointed out that if drug manufacturers had cut costs to the extent Trump claims, they would be shouting it from the rooftops, especially given the heat they've taken over the years for their pricing practices. "My expectation would be that they would make announcements - public announcements - and that those announcements would come way in advance of the actual effective dates when those price cuts would come into effect," she said. Joyce agreed that there has been no indication of a substantial cut. "Not at all, not at all, none whatsoever," he said. "And let alone 1,500."