Trump has a golden opportunity to stick it to the international freeloaders who've been riding America's coattails on medical innovation for far too long.
Last week, while unveiling his cabinet to a room full of governors, he threw down the gauntlet. With HHS Secretary Robert F. Kennedy Jr. and Dr. Oz, his pick for CMS, by his side, Trump zeroed in on a glaring injustice: "Why in the United States do we pay $1,300 for a drug... and in London they pay, literally, $200?" With his usual brashness, he didn't mince words: "Americans are being screwed, and it's no good."
The usual suspects—Senate Democrats like Sanders, Warren, and Wyden—wasted no time trying to "help." The day after Trump's inauguration, they sent him a letter begging him to keep the Inflation Reduction Act (IRA), the Biden bill that imposed prescription drug price controls and used the Medicare savings to give away to wind, solar, and electric vehicles cronies.
They correctly spotlighted the problem of Americans paying far more than other countries, but their too-easy answer to this problem is to link U.S. drug prices to whatever socialist backwaters like Canada or France feel like paying. It's a full-on import of price-control lunacy.
This assumes drugmakers are just greedy villains gouging patients here while the rest of the world plays smart. Wrong. Americans are getting taken for a ride because we let other nations piggyback on our R&D bill. It costs a jaw-dropping $2.5 billion to bring a single drug to market. If there is no path to earn that back and a reasonable return on capital then new cures will not be developed. Instead of the rest of the world hitching a free ride, there would be no moving vehicle for anyone to latch onto.
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Trump, unlike Biden, understands that you can't get the same number of new drugs developed if every government is imposing price controls. His instincts have always been spot-on: make the freeloaders pay up. For decades, other countries have muscled American drugmakers into dirt-cheap deals, leaving U.S. patients to foot the innovation bill. Time to flip the script. Trump's already got the playbook from his first term–he actually convinced Canada and Mexico to pay more for biotech drugs via a longer data exclusivity period in the original version of USMCA, before Nancy Pelosi forced him to take that provision out.
Or consider NATO, where he strong-armed allies into coughing up billions more for defense after years of mooching off America's military muscle. Critics clutched their pearls, but he got results. Those same freeloaders banked the savings from America's security umbrella to fund their cushy healthcare systems, systems that then turn around and lowball drug prices.
Trump is now using tariff threats to get Colombia, Mexico, and Canada to cooperate on border enforcement. Europe is slashing car tariffs to dodge a trade war. Why not add foreign drug price controls to the mix?
If Trump presses trading partners to shoulder more of the R&D burden, simple math kicks in: higher prices abroad, lower prices here. Pair that with deregulation of the FDA approval process that makes it so expensive to bring new drugs to market, and you've got an agenda that will deliver more new cures at lower prices for Americans. It's classic Trump: negotiate hard, win big, and make America not just great, but healthy again.
Phil Kerpen is the president of American Commitment and the Committee to Unleash Prosperity.
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