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Democrats’ Drug Price Bill May Be Dead on Arrival

After a nine month effort to produce a bill that Trump might support, it looks like Nancy Pelosi outfoxed herself.

Win McNamee/Getty Images

After nine months of negotiation, Nancy Pelosi has unveiled her proposal to reduce drug prices. The bill would allow the Secretary of Health and Human Services to negotiate with drug companies on the Medicare prices of between 25 and 250 drugs, setting an upper price limit of 120 percent of the average price of drugs in six other countries. (Slap that extra 20 percent on because America is Great and must always spend more, remember.) If manufacturers don’t negotiate, the government can levy a 65 percent tax on gross sales of that drug; over time, that tax can balloon to 95 percent. Crucially, the bill would also address the non-Medicare prices for those drugs, by assessing a civil penalty of 10 times the difference between the negotiated price and what they charged if the companies don’t offer the same prices to private insurance.

The bill is notable for being much stronger than earlier proposals floated by Pelosi’s office, which had been restricted to Medicare prices, included having an arbitrator negotiate prices, and permitted the HHS to negotiate prices on only 25 drugs. Now, 25 is the floor, not the ceiling—though progressives are also not thrilled about the 250-drug cap. The bill, however, is much better than the progressives had feared.

One major source of the progressive agita over this process was the involvement of Wendell Primus, the remarkably-named Pelosi aide who reportedly promised health insurers that the Speaker’s office would be allies in their fight against single-payer health care. In February, Politico reported that Primus was “searching for an approach that could both significantly lower drug prices and potentially win support from the Trump administration.” And yesterday, Pelosi echoed that, saying: “We do hope we have White House buy-in.”

But while Trump tweeted that it was “great to see” Pelosi’s bill, as if he and the bill had a brief but pleasant conversation at the Met Gala, the response from Senate Majority Leader Mitch McConnell was more in tune with the governing philosophy of Republicans: No, it socialism; socialism bad; bill bad. McConnell told reporters Thursday afternoon: “Socialist price controls will do a lot of left-wing damage to the healthcare system. And of course we’re not going to be calling up a bill like that.”

So we come to the end of nine months of work on a bill that only exists to get passed, and the best Pelosi can say is that she hopes to have the White House buy-in for which she labored. It’s a pity. There were pre-existing alternatives that could have spared Pelosi all the lost time and effort: House Democrats already had two other bills on drug pricing, both of which use a mechanism called compulsory licensing. Sen. Sherrod Brown and Rep. Lloyd Doggett’s bill would strip drug companies of their exclusive rights to manufacture a drug if they didn’t negotiate on the price, and Rep. Ro Khanna and Sen. Bernie Sanders’ bill would do the same if a drug cost more than it does in certain other developed countries, like Britain and France.

Each approach has its merits, but more importantly, either might have been presented to voters as a bold Democratic proposal on drug prices. Both have a tinge of macho swagger, as well. Sanders’s bill has an America-humping idea—“Why should we pay more than the darn FRENCH?”—at its core. Doggett’s has a keen sense of cowboy aggression: You better negotiate with us, or we’ll make you negotiate. (There’s also a bipartisan Senate bill, sponsored by Sens. Ron Wyden and Chuck Grassley, that focuses only on Medicare and has already caused much internal strife with Republicans.)

The polling, to which Democrats usually pledge blood fealty, could not be clearer on this issue: The public is mad as hell about drug prices. A Kaiser Family Foundation poll from March found 79 percent believe drug prices are unreasonable, and 80 percent attribute that in part to drug company profits. Meanwhile, 89 percent favor making it easier for generics to come to market, including 85 percent of Republicans.

It seems almost no one who is not employed by or invested in the pharmaceutical industry thinks the status quo is good, and there is almost no proposal that Democrats could make that would be too extreme for America. (Funny, then, that almost no one talks about Elizabeth Warren’s limited government drug manufacturing scheme; the Kaiser poll didn’t ask about it, either.) A 2016 poll by Lake Research Partners found two-thirds support for making “prescription drugs public goods paid for by the federal government and available to all Americans at an affordable price.”

Pelosi now must maneuver around McConnell and use this alleged “White House buy-in” to bring this long and arguably unnecessary effort to fruition. Any divergence between Trump and his fellow Republicans in the legislature is down to the president having a greater yen for Very Strong Action on issues that matter to people outside Washington than most Republicans. Through a canny combination of his personal racism, being dumb as a bar of soap, and coming to his own idiosyncratic politics largely through watching Fox News, Trump is tuned into the mind of a particular kind of Republican-voting Average Joe just a little bit more than your average crinkled Washington toff, who would never think of eating McDonalds when they could be ordering from The Palm.

And so Trump understands that that people are very upset about drug prices—and is especially aware that his base includes many among the angered strugglers for whom looming Islamic socialism and migrant caravans aren’t a sufficient distraction for the grim reality of drug prices. He has also come to realize that it is important to promise big things, like the Wall, and to appear to be fulfilling these promises. What he hasn’t figured out is that doing anything beneficial on drug prices is antithetical to the ideology and values of the Republican party that he leads, and that exposing this rift ought to, if the Democrats were at all competent, damage the party. This is why he occasionally slips up and says things like “why can’t Medicare cover everybody?” A great question, sir!

Pelosi’s best hope for getting a drug price bill through the Senate, with the White House’s support, was tapping into this part of Trump’s feeble brain. Therein lies the problem. Can you, a normal person who does not spend all their time on Capitol Hill, imagine Trump ordering Mitch McConnell to force his caucus to accept drug pricing proposals far stronger than the ones that PhRMA-backed conservative groups have just spent a year calling outrageously socialist? Only in Trump’s head do such impressive interactions occur. When Trump is out on a limb, he’s the most easily routed man in Washington. All it would take is one phone call in which McConnell assures the president that he is very correct and smart to have realized that foreign price controls are socialist, and Trump will tweet something along the lines of: “I worked with Nancy on drug prices for months, sadly what she came out with was not what we agreed on. Very disappointing. NO SOCIALISM!” And that will be that.

Pelosi’s only alternative is to somehow manage to get a version of this bill—likely much weakened—passed and signed. In that case, Pelosi would bestow on Trump a wonderful 2020 gift on one of the major issues causing pain and suffering in American voters’ lives today. This is not to say that the goal of every piece of legislation should be a new cudgel with which to beat electoral opponents, but it would undoubtedly work out better for a Republican president to point to his great bill than a Democratic 2020 contender who had nothing to do with the process. But no matter: McConnell has made it clear that this won’t happen.

This is nothing that couldn’t have been gamed out from the outset. And so it’s a genuine puzzlement that Pelosi spent nine months of negotiations, along the way creating deep rifts in her caucus—all while not actually talking about drug prices—in order to avoid letting her caucus pass one of the two better ideas they had in their pocket. If the argument was that the two bills in hand would have been referred to as “socialism,” well, guess what: The same fate befell Pelosi’s alternative, in predictable fashion. In the best case scenario, an unpopular president receives a huge political win in a reelection year. (In all the other scenarios, Democrats merely squander the first nine months since returning to power in the House.)

What will get us closer to all Americans being able to obtain the drugs they need? Nancy Pelosi thinks the answer is to craft a bill Republicans will approve of, and making Bipartisan Deals that Everyone Gets Behind. The real answer involves defeating and destroying the Republican Party, and instituting Medicare for All. Pelosi hates that, too, so at least that’s some common ground with Mitch McConnell. Diabetics may be dying, but the spirit of bipartisanship lives on.