President-elect Trump threat fails to halt drug price hikes in 2017
NEW YORK — Will President-elect Donald Trump target his Twitter cannon on drug companies next?
The president-elect put the pharmaceutical industry on notice last month about rising drug prices. “I’m going to bring down drug prices,” Mr. Trump told Time. The warning immediately sent biotech stocks tumbling.
However, in the first few days of 2017, drug companies have already put in place a wave of significant price hikes, despite Mr. Trump’s cautionary comments.
For instance, Biogen jacked up the price on three different multiple sclerosis treatments — Tecfidera, Avonex and Plegridy — by 8%, according to Raymond James.
Prices for Ampyra, another treatment for patients with MS, have gone up by 9.5%, Acorda Therapeutics confirmed to CNNMoney. Likewise, Teva Pharmaceutical said it has boosted the price of relapsing MS treatment Copaxone by nearly 8%.
It’s not just MS drugs that are getting pricier. Arthritis treatment Orencia is 6% more expensive this year, according to manufacturer Bristol-Myers Squibb.
AMAG Pharmaceuticals just enacted a 4% price hike on kidney disease treatment Feraheme and AstraZeneca raised the price on ovarian cancer drug Lynparza by 5%, according to Raymond James.
The price increases are a sign that it’s business as usual in the drug industry. That’s despite the December threat from President-elect Trump. At that time an ETF that tracks biotech stocks dropped more than 4% on the day of Mr. Trump’s comments to Time.
“Either investor fear is overblown or management teams have a tin ear,” Christopher Raymond, an analyst at Raymond James, wrote in a report on Tuesday.
Raymond said he suspects investor concern about crackdowns is exaggerated. He pointed to how “real reform” of drug pricing must include changes to the complex payment structure along with market-based reforms designed to introduce competition.
Still, Raymond said, “We don’t rule out more public shamings of some of the more egregious examples” of price hikes.
Since being elected, Mr. Trump has used his Twitter account to call out companies for other issues, mostly over shipping jobs overseas or expensive military contracts. Just this week, the president-elect warned General Motors to make its Chevrolet Cruze in the U.S. or face a big tax.
Several drug makers that raised prices this week defended their actions.
Acorda told CNNMoney that Ampyra is the company’s “only meaningful product on the market” and noted that 40% of the MS drug sales are invested back into R&D. Acorda also noted that it’s not profitable and is working on treatments for Parkinson’s and migraines.
“Our goal is to work constructively with Congress and the Administration to ensure that people retain their access to the medicines, healthcare and healthcare insurance they need,” Acorda said in a statement.
Teva noted that Copaxone has proven to be an effective and safe treatment for relapsing forms of MS.
“We remain committed to ensuring the price of Copaxone reflects the clinical utility of the drug,” Teva said.
Biogen, AMAG Pharmaceuticals and AstraZeneca did not respond to requests for comment.
Drug prices have become a hot issue. This past summer, for instance, there was a national outrage of a 400% surge in the price of lifesaving allergy treatment EpiPen.
Before EpiPen, there was a firestorm of controversy over the 5,000% overnight increase in the price of Daraprim, the AIDS drug acquired by a company run by the notorious Martin Shkreli.
While Hillary Clinton was more outspoken on the issue than Mr. Trump, the president-elect did call for legislation during the campaign that would allow for importing “cheaper” drugs from overseas.
“Congress will need the courage to step away from the special interests and do what is right for America,” Mr. Trump’s campaign website said.