Trump Drug Pricing Plan Would Squash Innovation

Days before Thanksgiving, President Trump announced the final details on a long-promised plan to link Medicare payments for certain advanced medicines to the lower prices paid abroad.

The effort — called the "most favored nations" model — attempts to address the disparity between the prices paid by Medicare and the prices paid by governments in places like Canada, the United Kingdom, and France. But the approach is profoundly confused.

Our peers in the developed world pay lower prices because their healthcare systems employ government-imposed price controls. The United States has a unique healthcare system within which, in exchange for higher healthcare costs, Americans enjoy far greater choice of and access to the latest and most innovative treatments and cures. They also benefit economically. Thanks to appropriate funding for biopharma industry scientists, the United States is the epicenter of medical innovation and home to the world's most dynamic and thriving life sciences sector.