Big Pharma companies are announcing that they are jacking up drug prices just months after President Donald Trump took to Twitter and boasted that they would roll them back or hold them down at his request.
Just as car manufacturers are shuttering plants after Trump claimed that he was responsible for a surge in manufacturing jobs, drug manufacturers such as Pfizer and Merck announced this week that they will increase pricing -- contrary to Trump's promise of price decreases.
According to business columnist Micheal Hiltzik of the Los Angeles Times, the manufacturers pulled a fast one when they told Trump they would defer planned price increases back in May, only to drop the bomb before the end of the year.
On July 10th, Trump tweeted: "Just talked with Pfizer CEO and @SecAzar on our drug pricing blueprint. Pfizer is rolling back price hikes, so American patients don’t pay more. We applaud Pfizer for this decision and hope other companies do the same. Great news for the American people!"
But industry observers point out that Trump lied when he bragged about prices "rolling back."
As Hiltzik writes, "Instead, the company said it would 'defer' price increases on 41 drug formulations it had scheduled for July 1 until either Trump’s 'blueprint to lower drug prices' went into effect or the end of the year, whichever came sooner."
He points out that Peter Maybarduk of advocacy group Public Citizen noted at the time, "Pfizer is only deferring price increases — not canceling them, and certainly not lowering its prices.”
According to University of Pittsburgh pharmaceutical policy expert Walid Gellad, drug companies humored the president while making plans to go ahead with raising prices after getting kudos from Trump.
"Making promises to the president is not how you fix a fundamental market problem,” Gellad explained.
The Times report notes that Merck manipulated public opinion -- and possibly the president -- by playing fast and loose with the truth.
"Merck, in its July 20 announcement of price cuts, built itself a rather more elaborate loophole. The company said it would not increase the average net price of its entire portfolio of drugs by more than inflation annually," Hikltzik wrote. "It dressed up the announcement by lowering the price of Zepatier, a hepatitis C treatment, by 60% and of six other drugs by 10%."
He then noted that the seven drugs listed were small, unpopular and unprofitable formulations that account for very little of their sales, writing, "Zepatier sales had fallen so low by the first quarter of this year that Merck listed the drug’s U.S. sales in its quarterly financial report as essentially zero."
Addressing just Merck's announced increase, and using its 2017 revenues as a guide, Hiltzik said the announced increases "will fatten Merck’s profits by about $357 million, or 15%."
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