Of all the promises President Donald Trump made for theearly part of his term, controlling stinging drug prices might have seemed theeasiest to achieve.

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An angry public overwhelmingly wants change in an easilyvilified industry. Big pharma’s recent publicity nightmare includedthousand-percent price increases and a smirking CEO who said, “I liken myself to therobber barons.” Even powerful members of Congress from both partieshave said that drug prices are too high.

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But any momentum to address prescription drug costs — a problemthat a large number of Americans now believegovernment should solve — has been lost amid rancorous debates over replacing Obamacare and stalled byroadblocks erected via lobbying and industry cash.

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“There is a very aggressive lobby that is finding any and allmeans to thwart any reform to a system that has produced verylucrative profits,” said Ameet Sarpatwari, an epidemiologist andlawyer at Harvard Medical School who follows drug legislation.“Everything that’s coming out is being hit and hit hard — evenstuff that’s commonsensical.”

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Those in Congress concerned with health policy have spent muchof the year advancing proposals to overhaul the Affordable CareAct, none of which would affect pharmaceutical pricing. The latestRepublican proposal, by Senators Lindsey Graham of South Carolinaand Bill Cassidy of Louisiana, is no different.

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Meanwhile, more than two dozen bills aimed at curbing drug costshave been introduced in this or the previous Congress, according tothe Drug Pricing Lab, a Memorial Sloan Kettering Cancer Centerprogram that has catalogued ideas for reducing prices. Manyhave bipartisan support.

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Proposals include importation from other developed countries,where regulations keep prices down; allowing government tonegotiate the price of Medicare-covered drugs; speeding approval ofcheaper generics; requiring notification before raising drugprices; and restricting consumer drug ads.

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Other ideas that haven’t made it to legislation include banningpatents for pills that simply copy or repackage existing medicines;and adjusting prices according to a drug’s effectiveness.

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“There’s clearly no single solution out there that will solvethis rapidly rising spending,” said Dr. Peter Bach, who leads thelab. But, he added, “there’s not a lot of fundamental disagreementabout the direction this needs to move.”

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Continued on next page>>>

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Kaiser Health News, a nonprofit health newsroom whosestories appear in news outlets nationwide, is an editoriallyindependent part of the Kaiser Family Foundation.

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Trump drew new attention to the issue last month by tweetingthat Merck’s chief executive, Kenneth Frazier, “will have more timeto LOWER RIPOFF DRUG PRICES!” after Frazier quit the president’smanufacturing council to protest his remarks about whitesupremacists in Charlottesville, Va.

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Those comments matched Trump’s characterization earlier this year of drugcompanies as “getting away with murder.” That same January day,a dozen Republican senators, including Ted Cruz of Texas, JohnMcCain of Arizona and Mike Lee of Utah, voted for the old liberalidea of letting Americans buy less-expensive drugs from Canada.

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The measure was attached to a budget resolution and wouldn’t, by itself, have allowed importation.It failed 52 to 46 after 13 Democrats voted against it, with someciting safety concerns about foreign-sourced medicine — an ideapromoted by American drugmakers.

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Even so, the vote prompted speculation that a pharma price dealmight be within reach.

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Sen. Lee is one of the Republicans who favor importation as away to increase competition. “When we’re talking aboutgarden-variety, generic drugs that can be easily imported fromanother country that has regulatory procedures that make themsafe?” he said in an interview. “I don’t see why not.”

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In response to the new threats, the Pharmaceutical Research andManufacturers of America, already one of Washington’sbiggest-spending trade groups, increased member dues by half last year toprepare for battle.

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The pharmaceutical and health products industries spent $145 million on lobbying for the firsthalf of 2017, according to data from the Center for ResponsivePolitics.

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Drug manufacturers gave $4.5 million to congressional campaignsin that period, including six-figure donations to House SpeakerPaul Ryan; Rep. Greg Walden, head of the House Energy and CommerceCommittee; and Sen. Orrin Hatch, head of the Senate FinanceCommittee, according to a Kaiser Health News analysis.

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PhRMA’s “Go Boldly” campaign, showing heroic researchers seekingcures, has spent $28 million so far this year on six ads shown onabout 4,600 national TV channels, according to iSpot.tv, an adtracker.

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The industry hired former FBI director Louis Freeh to study the impact of importation. Heconcluded that it would “leave the safety of the U.S. prescriptiondrug supply vulnerable to criminals seeking to harm patients.”Import proponents argue the Food and Drug Administration couldeasily ensure safety by licensing and inspecting Canadiansuppliers.

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Drugmakers say that high prices reflect heavy investment ininnovation and drug development. They reject the notion that theindustry wields too much influence in Washington.

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“These are important issues with significant ramifications,”Holly Campbell, a PhRMA spokeswoman, said. “So we will continue tobe engaged with the administration to advance solutions thatimprove the marketplace and make it more responsive to the needs ofpatients.”

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Continued on next page>>>

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Kaiser Health News, a nonprofit health newsroom whosestories appear in news outlets nationwide, is an editoriallyindependent part of the Kaiser Family Foundation.

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The top 10 publicly traded U.S. drug companies made $67.8billion last year, after taxes, regulatory filings show.

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Efforts to restrain prices have made little progress in theexecutive branch, either.

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The White House has long been expected to issue an executiveorder on drug costs. But leaked documents show that deliberations havefocused on things the industry wants, such as extending overseas patents and changing adrug-discount program for hospitals, and not so much on loweringprices.

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Gerard Anderson, a health policy professor at Johns HopkinsUniversity, said Trump’s draft order “did not talk at all aboutbranded drugs or about specialty drugs,” including for rheumatoidarthritis and cancer, that have seen especially steep priceincreases. “If that represents the administration’s thinking, thenmy guess is there is not much effort.”

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Trump’s ongoing feud with congressional Republicans, especiallySenate Majority Leader Mitch McConnell, means “you’re not going toget any strong direction or leadership out of the White House” ondrug prices, said Vishnu Lekraj, who follows pharma stocks forMorningstar, an investment research firm.

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Trump isn’t the only one in his administration criticizing drugcompanies. Scott Gottlieb, the FDA commissioner, has accused theindustry of “gaming” the system to delay the appearance of cheap genericsafter patents expire. He has pledged to speed applications forgenerics when there is little competition as part of a “drug competition action plan” while opposing stronger measureslike allowing importation.

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But promoting generics is “reasonably small potatoes” comparedwith the money that could be saved by putting direct pressure onbrand-drug prices, Anderson said. Gottlieb has served on the boardsof severalpharmaceutical companies and reaped large consulting andspeaking fees from the industry.

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Yet even small potatoes might be a long shot — despitewidespread agreement that change is needed.

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“It is sort of remarkable to see just how far the system canbend before meaningful reform is taken,” said Sarpatwari ofHarvard. “If there ever was a time to strike while it’s hot, it’snow.”

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Elizabeth Lucas and Sydney Lupkin contributed to thisreport.

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Kaiser Health News, a nonprofit health newsroom whosestories appear in news outlets nationwide, is an editoriallyindependent part of the Kaiser Family Foundation. KHN’scoverage of prescription drug development, costs and pricing issupported in part by the Laura and John ArnoldFoundation.

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