Indian drug makers who sell copycat drugs are facing heat in U.S. due to steep competition and pricing pressure and were keenly watching Trump's speech - who earlier accused the pharmaceutical industry "getting away with murder" and threatened "sweeping action".
Shares of major drugmakers, insurers and PBMs rose after the speech. Health insurer Aetna rose 2.3 percent and UnitedHealth gained nearly 2 percent.
Of the pharma giants, Johnson & Johnson's stock prices went up 0.9%, Pfizer Inc. gained 1.2%, UnitedHealth Group Inc. stocks rose 1.3% and Merck & Co.
The American Hospital Association, which is suing to block the 340B cuts, urged Trump to "oppose any efforts to scale back" the program, calling it "a critical tool in the toolbox that provides drugs at lower prices to those on the front lines of patient care". In his speech, Trump also mentioned ending "dishonest double-dealing" where PBMs don't pass on rebates meant for patients.
"The United States both conducts and finances much of the biopharmaceutical innovation that the world depends on, allowing foreign governments to enjoy bargain prices for such innovations", the council's report said. In the first three months of this year, the industry has already spent almost $10 million for lobbying.
"AARP has long supported ... allowing the Secretary of Health and Human Services to negotiate lower drug prices on behalf of millions of Medicare beneficiaries", Executive Vice President and Chief Advocacy & Engagement Officer Nancy LeaMond said in a statement.
Newspaper reports recently revealed that Swiss drug maker Novartis paid Trump's former attorney Michael Cohen $1.2 million in "consulting" fees a year ago, despite the fact that Cohen lacked any qualifications to provide such services.
Wholesale inflation rises 4-month high at 3.18% in April
The inflation data for February was revised upwards to 2.74 per cent from the provisional estimate of 2.48 per cent. On a YoY basis, onion prices in April 2018 soared higher by 13.62 per cent and potatoes by 67.94 per cent.
Unlike Trump's fiscal 2019 budget proposal, the majority of the actions don't need Congress' approval, senior administration officials said.
'We are going to take on one of the biggest obstacles to affordable medicine - the tangled web of special interest, ' he declared.
Responding to the idea that getting other countries to pay more for drugs would result in lower prices in the US, Paul Ginsburg, a professor of health policy at USC and the director of the USC-Brookings Schaeffer Initiative for Health Policy, said it would have no such effect and simply raise pharma company profits. Some states negotiate supplemental discounts for certain drugs.
Chad Landmon, an attorney who chairs law firm Axinn, Veltrop & Harkrider's intellectual property and FDA practice groups, told FierceHealthcare that the pharmaceutical industry was holding its breath when talk of a drug pricing plan began. Moreover, the price controls and regulations in other countries have not made it unprofitable to sell drugs there. "We believe Americans should know which drug companies are gouging consumers and which ones are being good actors for our communities". "Plans negotiate discounts, rather than just paying full price".
"President Trump offered little more than window dressing to combat the rising cost of drugs-a problem that is pinching the pocketbook of far too many Americans", Democratic Senate Minority Leader Chuck Schumer said after the speech.
Azar said that Trump views tougher negotiation as key to the plan, and that his agency will consider an alternative system for buying Medicare Part B drugs, which are administered by a healthcare provider and covered directly by the government.
The price on Celgene's widely used Revlimid - a connection Evercore ISI's Umer Raffat made in a note this afternoon - was jacked by 20% over the a year ago, which means that Medicare patients pay an extra $115 month, moving from $575 to $690 per month, for their share of a drug that had cost $11,500 a month in 2015.