Food and Drug Administration Commissioner Marty Makary said his agency may fast-track new drugs from pharmaceutical companies that “equalize” the cost of their medicines between the US and other countries, an unusual proposition from the regulator that’s long avoided contentious pricing debates.
The comments, made in an interview on Bloomberg Television’s Wall Street Week with David Westin, offer insight into an idea floated to help the administration achieve one of President Donald Trump’s main health-care goals: ensuring foreign countries aren’t getting a better deal on drugs. Trump demanded that Americans get similar or lower prices as consumers in other countries in an executive order signed in May.
Price adjustments may give companies another way to obtain “national priority vouchers,” the reward that comes as part of a new program the FDA announced last month that would slash review times for companies it says are backing national interests. Makary didn’t offer details about how drugmakers would have to adjust their prices to qualify for a voucher.
“We can issue a national priority review voucher for companies that are promising to equalize the price” between the US and what other foreign countries pay, Makary said. “We want to incentivize good behavior in the marketplace, and these priority vouchers are worth a lot of money.”
The new vouchers would cut review times to one to two months, down from an average of about 10 months to one year now, the agency said. In the interview, Makary said the program could be used as a tool to even out drug prices with those currently charged in places like Europe.
The Department of Health and Human Services has asked drugmakers to price therapies that don’t have generic competition at the lowest level offered to any member country in the Organization for Economic Cooperation and Development that has an economy at least 60% of the size of the US on a per capita basis.
The FDA typically has avoided inserting itself into the murky world of drug pricing in the US. Explicitly trading faster reviews for price changes on existing treatments would be abnormal for the agency, which doesn’t have authority “to investigate or control the prices charged for marketed drugs.”
It’s also unclear how much of an impact the vouchers would have. Makary touted the value of pediatric priority review vouchers offered under a different program, which is currently coming to an end. He noted that some have sold for more than $100 million in a secondary market, which was legal. The new national priority vouchers can’t be sold.
Drugmakers also have limited control over what patients ultimately pay in the US, where a complex system of insurance companies and drug benefit managers typically operates in the space between where a patient is given a prescription and where they get their medicine from a pharmacy.
Still, the approach could offer a financial incentive for drugmakers to lower drug prices. When Trump pursued equalizing costs in the US with those abroad during his first term, he exclusively used a more punitive approach, issuing regulations that would have reduced what Medicare, the health insurance program for the elderly and disabled, pays for medications administered in physicians’ offices.
In the initial announcement of the voucher program, FDA said they could be offered to return drug manufacturing to the US, address health crises or unmet public health needs, or provide innovative cures.
The interview will air Friday at 6 p.m. in New York.
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