The Trump administration has launched TrumpRx.gov, a site meant to direct patients to drugmakers’ websites, though officials say it will not be fully operational until January. (Trump RX)
Michael Baker, director of healthcare policy at the American Action Forum, said government price setting shifts costs rather than eliminating them.
"At the most basic level, government price setting only limits what patients pay for a drug — usually reflected in an out-of-pocket or co-insurance payment," Baker said. "This does nothing to address the overall cost of the drug, which someone still has to pay, nor does it lower the cost associated with development."
As a result, Baker said, patients ultimately bear those costs through tighter coverage rules, fewer treatment options or reduced future innovation.
"Patients will experience far less of the crown jewel of the U.S. healthcare system that they are currently accustomed to receiving," he added.
Economists say the effects of permanent price caps would also be felt upstream, in research and development.
"We know for sure that if drug prices are capped permanently below the levels the firm would have set, that will lead to lower incentives for R&D to discover new drugs and bring them to market," explained Mark V. Pauly, professor of healthcare management at The Wharton School at the University of Pennsylvania.
EXPERTS SAY MEDICAID CHANGES IN 'BIG, BEAUTIFUL BILL' ARE 'COMMON SENSE' FOR HEALTHCARE POLICY
U.S. President Donald Trump has centered his economic agenda on lowering prices and boosting wages. (Cornell Watson/Bloomberg/Getty Images)
"The kind of government price controls that are most damaging to innovation are ones that limit the initial price a company can charge for a new product. That is the situation in some countries, but fortunately not yet the in the United States," he added.
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Ryan Long, Paragon’s director of congressional relations and a senior research fellow, suggested that pricing pressure abroad could force foreign governments to shoulder a greater share of drug development costs.
Long said this strategy would lead "to lower prices for American consumers without sacrificing U.S. leadership in biopharmaceutical innovation that leads to new treatments and cures."
Amanda covers the intersection of business and geopolitics for Fox News Digital.
https://www.foxnews.com/politics/trump-promises-cheaper-drugs-under-trumprx-economists-say-long-term-costs-may-hidden