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Insulin, Epinephrine Price Breaks Unlikely Despite Trump Order

July 28, 2020, 9:25 AM

Insulin and epinephrine costs for most Americans won’t drop under a White House plan to reroute drug discounts directly to patients, health lawyers said.

The community health centers targeted in the order already sell discounted drugs to patients, and the Trump administration may not have the legal power to force deeper discounts at enough pharmacies to make a difference, lawyers said.

President Donald Trump’s July 24 executive order directs federally funded health centers to sell patients insulin and injectable epinephrine at the same discounted price they got it from a drug company. Trump said his goal is to give more people affordable access to two critical, often expensive drugs.

Rather than taking steps to address rising prices for lifesaving drugs, the executive order recycles techniques the Trump administration has already seen die in court or flounder at federal agencies.

“This is a dramatic under-reaction to the insulin pricing crisis that Americans face,” Matthew Cortland, a health-care lawyer and policy analyst in Massachusetts, said.

Trump’s assertion that these health centers are gouging on drug prices is “bizarre,” he said. Even if the policy moves forward—which Cortland said is unlikely—"the potential reach of this program is small.”

There are roughly 1,400 community health organizations, which serve areas with limited access to health-care coverage, according to the Health Resources and Services Administration. Those organizations run roughly 12,000 delivery sites. The rule would only apply to organizations that get funding from the federal government through a specific statute, and it’s not clear exactly how many pharmacies would be affected by the rule.

The Department of Health and Human Services didn’t immediately respond to a request for comment.

Authority in Question

The Trump administration has already tried to alter the federal discount that hospitals that serve low-income patients get from drug companies, which is known as the 340B discount. The Centers for Medicare & Medicaid Services lost twice in court after trying to cut Medicare reimbursement rates for those discounted drugs.

The executive order is another attempt by the administration to change the discount program without actually using the 340B statute itself, said Helen Pfister, a partner at Manatt Health who specializes in 340B policy. By trying to change the discount policy through the grants rather than going through 340B itself, “the administration is acknowledging they don’t have the authority,” she said.

Similarly, Steve Carey, chief strategy officer for the National Association of Community Health Centers, said the group doesn’t plan on suing the federal government over the order because “it’s not enforceable anyway.”

To contact the reporter on this story: Jacquie Lee in Washington at jlee1@bloomberglaw.com

To contact the editors responsible for this story: Fawn Johnson at fjohnson@bloomberglaw.com; Andrew Childers at achilders@bloomberglaw.com

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