How Will Pharma Companies React to the Administration's Efforts?

Pharmaceutical Executive: How will pharma companies react to the administration's efforts?
Dr. William Soliman: We’ve seen Pfizer doing a deal with Trump, and I think other companies will follow. If they can come to a compromise for even just some branded drugs, that’s a happy middle-ground. What they’re looking for in exchange for dropping prices is for the administration to push back the tariffs. That’s part of the Pfizer deal.

I do think it will make a difference and pharma companies will concede, even if not fully to what Trump wants. Even if it’s a little bit, that’s still better than nothing.

PE: What is the timeline for American patients to notice the impact on drug pricing?
Soliman: If you remember, the provision is specific to patients that are under Medicare. Elderly patients will see more of an impact. For people on commercial plans, the impact remains to be seen. But if you’re under a federally-funded program, you might see more of an impact.

In America, 80% of people on drugs are on generics. We talk a lot about pharma pricing, but the majority of people who are on multiple medications are on generics. For those drugs, you’re not going to see much of a difference. It’s mostly for the branded drugs where you’ll see some savings.

PE: How will US drug price negotiations impact global market dynamics?
Soliman: In the US, it’s going to put more scrutiny on how we price drugs, how the pricing models are developed, and how we determine if they’re fair. Today, in the United States, FDA doesn’t look at cost effectiveness as criteria. In Europe, they do. We may move towards more of an emphasis on looking at how we’re going to price drugs before we bring them to the market and commercialize them.

Pricing in comparison to other countries wasn’t something that people talked about in the media until the Trump administration brought it up. A lot of people knew it, and people would get their drugs from Canada or something like that. It wasn’t something that any administration had thought about in any formal way.

From that perspective, the MFN executive order is a great idea, but the devil is in the details, such as which drugs are required to be in there.

Pharmaceutical Executive: How is the pharma industry already reacting to the administration's efforts?
Soliman: We’ve seen a lot of pharma companies saying that they want to comply and work with the administration. Some have already committed to manufacture domestically. Long term, this could be good for the country. I agree with the administration that relying on foreign countries could be a national security threat.

There’s been a lot of data published about some of the quality and safety concerns coming out of some of the plants in China. FDA has had a hard time auditing those plants. It’s a good thing for pharma companies to manufacture here long term. Will there potentially be an increase in cost? There could be.

How much will get passed down to the patient? That remains to be seen. Overall, it’s a net positive because it means we don’t have as much reliance on these other countries.

We know that generic drugs are often manufactured outside of the US and we often see that these drugs, unfortunately, can be compromised. There’s been a lot of issues.

PE: How are the drug pricing negotiations impacting pharma's relationship with DC?
Soliman: Since the IRA, there’s been strain between DC and the pharma industry. During the Biden administration, his administration attempted to put a price cap on insulin and there was a lot of push back. A lot of the pharma companies left the trade organization PHARMA. Some went to the courts to fight.

There’s some strain, and I think it is unfair to the pharma industry to put these kinds of limits and caps on what they’re doing. Making the pharma industry cap out costs could stifle innovation. The pharma industry has helped to cure major diseases, like polio. HIV used to be a death sentence, and now people can be kept alive.

PE: How are other players in the healthcare industry reacting to drug pricing negotiations?
Soliman: The insurance companies and PBMs, they make money on rebates. The rebates are based on the drug’s price, and the higher the price, the higher the rebate. If the drug price is lower, they’ll make lower profit. For PBMS, they’re probably not that happy about it. We saw this a few years ago during Senate hearings. The Merck CEO talked about how PBMs were driving up costs and the system was set up in a way that made it difficult to keep prices lower.

That’s something that must be explored.

PE: How are updates to FDA's processes impacting medical affairs teams?
Soliman: One of the things with the Trump administration, is that by FDA speeding up approvals with priority vouchers, this is going to speed up launch times. Today, if you’re a field medical affairs organization, making sure that your team has the broad skill sets to deal with policy changes that are happening across the country is important. Medical affairs, more so than salespeople, are the major face in front of doctors.

MSLs, on average, get about 40 minutes in front of a doctor, where a sales rep only gets about a minute.