Experts believe President Trump’s tariffs could bring higher drug prices and supply chain disruptions
Earlier this year, Senator Reverend Warnock introduced the Capping Prescription Costs Act which caps annual out-of-pocket prescription drug costs per year at $2,000 for individuals and $4,000 for families
Senator Reverend Warnock successfully capped the cost of prescription drugs at $2,000 per year for Medicare recipients
Senators Reverend Warnock, Luján: “We are concerned that the tariffs you [President Trump] have proposed on our trade partners will impact prescription drugs, driving up prices for Americans, exacerbating supply chain issues, and hurting domestic pharmaceutical manufacturers”
Washington, D.C. – Today U.S. Senators Reverend Raphael Warnock (D-GA) and Ben Ray Luján (D-NM), both members of the Senate Committee on Finance, led an effort to pressure the Trump Administration by highlighting the devasting impacts that new sweeping tariffs will have on the cost of prescription drugs for Americans. It is estimated that for certain drugs, the additional costs for a 24-week prescription could range from $8,000 to $10,000.
Following the letter, President Trump announced his intention to soon impose tariffs on pharmaceuticals coming from foreign countries.
“We are concerned that the tariffs you [President Trump] have proposed on our trade partners will impact prescription drugs, driving up prices for Americans, exacerbating supply chain issues, and hurting domestic pharmaceutical manufacturers. Steep tariffs on our closest trade partners only further increase the cost of prescription drugs for both consumers and manufacturers and will lead to drug shortages,” said the Senators.
Over 60 percent of American adults take at least one prescription drug, with 25 percent of adults taking four or more. Yet Americans often pay more for the same prescription drugs than people in other countries, and due to the cost burden, American patients often cannot afford their medications as prescribed. This results in patients skipping doses, cutting doses in half, or taking over-the-counter medications instead of their prescriptions. One study found that 31 percent of patients did not take their medications as prescribed due to cost, and any tariff implementation would only make medication more expensive.
“Rising costs have real consequences: nearly one-third of Americans are leaving prescriptions unfilled at the pharmacy every month due to cost. This has forced some patients to ration their prescriptions to stretch their budgets, which has deadly consequences. To cut down on cost, most Americans depend on access to generic drugs which account for 90 percent of all U.S. prescriptions. Many of these drugs and their components are imported from overseas,” the Senators continued.
“In addition to raising prices for everyday Americans, blanket tariffs also threaten domestic prescription drug manufacturers. Many pharmaceutical companies outsource production of active pharmaceutical ingredients (APIs), which are then imported and used to formulate prescription drugs here in the United States,” concludedthe Senators.
In the Inflation Reduction Act, Senator Warnock secured provisions in the legislation to cap the cost of insulin at $35 a month for Medicare patients and his plan to cap the cost of prescription drugs for seniors at $2,000 a year.
The text of the letter is HERE and below:
Dear President Trump,
We are concerned that the tariffs you have proposed on our trade partners will impact prescription drugs, driving up prices for Americans, exacerbating supply chain issues, and hurting domestic pharmaceutical manufacturers. Steep tariffs on our closest trade partners only further increase the cost of prescription drugs for both consumers and manufacturers and will lead to drug shortages.
Americans have faced increasing prescription drug prices for decades. Rising costs have real consequences: nearly one-third of Americans are leaving prescriptions unfilled at the pharmacy every month due to cost. This has forced some patients to ration their prescriptions to stretch their budgets, which has deadly consequences. To cut down on cost, most Americans depend on access to generic drugs which account for 90 percent of all U.S. prescriptions. Many of these drugs and their components are imported from overseas.
Many Americans also depend on brand-name drugs. Most brand-name prescription drugs available in the U.S. are manufactured overseas and imported by their marketers. In fact, several of these drugs were recently found to have price increases greatly outpacing the rate of inflation. Just three of these drugs used to treat type 2 diabetes, a disease developing more in children, teens, and young adults than ever before, were responsible for more than $8.5 billion in total Medicare Part D spending in 2022. Of these drugs, one has had a lifetime price increase of 293 percent. Thus, broad and sweeping tariffs will only exacerbate the issue of access to affordable medicine continually perpetuated by greedy actors.
In addition to raising prices for everyday Americans, blanket tariffs also threaten domestic prescription drug manufacturers. Many pharmaceutical companies outsource production of active pharmaceutical ingredients (APIs), which are then imported and used to formulate prescription drugs here in the United States. One such example is the anticoagulant drug Eliquis, whose API is manufactured in Switzerland. This drug has accounted for more Medicare Part D spending than any other drug for several years in a row. These trade barriers will drive up the cost of this already costly drug, further increasing Medicare spending and burdening patients’ pocketbooks. While brand-name pharmaceutical companies may have the resources to continue operations with rising costs, those that manufacture generic drugs will not. Generic manufacturers do not have this financial flexibility, which makes their ability to absorb new costs difficult. If generic manufacturers cannot keep up with rising costs, they may be forced to exit the market, leading to shortages of generic drugs that Americans rely on. As such, tariffs on imported APIs and other materials used to manufacture prescription drugs may hurt domestic pharmaceutical manufacturers, the supply chain, and thereby the American consumer.
We strongly urge you to consider the impacts of broad and sweeping tariffs on Americans and domestic manufacturing. Americans cannot afford to continue emptying their pockets just to refill their prescriptions at the pharmacy.
Thank you for your attention to this critical matter.
Sincerely,
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