L’Express: Donald Trump has just launched an offensive against pharmaceutical laboratories to obtain a drop in the price of medication in the United States. In parallel, it accuses European countries of being responsible for these additional costs. Is he opening a new front against Europe?
Thomas Rapp :: As always, the truth is more complex than Donald Trump claims. What is true is that drug prices are on average between two and three times higher in the United States in Europe, and especially in France. The gaps are sometimes gigantic. Take the Novo Nordisk ozempic: this diverted antidiabetic to combat obesity costs 969 dollars in the United States, against only $ 86 in Germany.
With the decree he has just signed earlier this week, the American president hopes to align prices with those practiced in countries with equivalent developments. This decision is not really a surprise. Trump had promised it during the campaign and had already tried to do so during his first mandate but he had not had time to go to the end of the process. Americans are actually paying for their health, especially access to medicines. In fact, the margins released by laboratories in the United States are much more important than in Europe, which allows, in part, to finance innovation. For Trump, European patients are therefore the clandestine passengers of the system. It is a vision a bit truncated in history because the European Union also has major investment programs in health research. And the innovation springs are not only linked to the price of the drug.
How then to explain such important differences in prices?
For reasons of market organization. Until very recently, there was no negotiation of the price of drugs at the federal level in the United States. In fact, pharmaceutical laboratories negotiated directly with private insurers. Obviously, private insurers have less negotiation power than entities as states. The second reason is that in addition-Atlantic, there is no assessment of health technologies as we do in Europe. That is to say that to enter the American market, pharmaceutical laboratories must not demonstrate the clinical superiority of their drugs over existing products, nor the economic impact for the American health system. Where, in countries like France, extremely strict evaluations are imposed, both on clinical impact and economic impact. The results of these assessments are used in price negotiations between French authorities and laboratories. Last explanation: if the price of medicines is so high in the United States, it is because the drug distribution networks involve different intermediaries which take on each important margins, with a lot of opacity.
What is paradoxical is that in his speech, Trump still makes Europeans responsible for this tariff situation when in hollow, he praises the European model and especially French?
I will not go so far! What Trump will do is use inflation Reduction Act set up by his predecessor to negotiate, for the first time in the history of the American health system, the price of medicines at the federal level.
For the moment, I have not seen any announcements concerning possible assessments of health technologies as is the case in Europe and whose results would condition the fixing of prices. In the EU, negotiations are made country by country and even, in certain states, region by region. To enter and market a new drug, it is sometimes very complicated. Even if we are witnessing a form of standardization of methods on the continent. Since the beginning of the year, Europeans have decided to set up a joint assessment of the clinical impact of drugs. We could therefore consider, ultimately, various changes. The implementation of more performance agreements, which make it possible to review the prices of drugs if the effects are not as important as what could be hoped for after clinical trials. The establishment of review clauses, a year or two years old. Finally, for the most expensive therapies, perhaps you have to think about price negotiations at European level.
Can Donald Trump’s decisions have repercussions in Europe?
Yes, by ricochet. If the laboratories accept such tight price conditions, especially in France, it is that in a way, they know that they make substantial margins in the United States. So if prices fall significantly in the United States, negotiations will tend even more in European countries. Some laboratories could choose to no longer launch their innovations on the French market, because negotiations become too difficult. And lead, therefore, to losses of luck for French patients in certain rare diseases for whom health insurance would not be able to accept very high prices … This is the real question.
Can the drop in drug prices in the United States have consequences for innovation?
It is estimated that the total cost of developing a new drug is between $ 2 and $ 4 billion. Figures to be taken with care, because it is very difficult to quantify this step. Many innovations are developed by biotechs that develop in the United States thanks to the abundance of private capital.
These investment funds recover their bet when the biotechs are bought by large laboratories. The pharmaceutical industry has been working on this model for decades. I am not sure that lower prices will overthrow it. On the other hand, we are at a time when many innovations will arrive on the market, much more than over the past years. Large global pharmaceutical laboratories have a lot of products in their “pipeline”, whose phase 2 and phase 3 results are promising. I do not think that lower prices in the United States will reduce the dynamics of innovation. On the other hand, this may lead to difficulties in patient access to these innovative drugs, especially in Europe.
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