TRUVADA IS AN extraordinary drug. Take one a day, and the chance of contracting HIV is reduced by up to 99%. Even without a cure for the disease, if all people at high risk of contracting it took the prophylactic pill, HIV would eventually be snuffed out. But a big problem is cost. There are 1.1m Americans, mainly gay and bisexual men, who should be on the pill, according to the Centres for Disease Control. In fact only 200,000 are taking it. A course of treatment costs $2,000 per month—nearly 45% higher than in 2013. In Britain generic versions of the pills available online mean the same treatment costs just £45 ($58).
Upgrade your inbox and get our Daily Dispatch and Editor’s Picks.
Such exceptional disparities in drug prices are typical in America. Pharmaceutical spending is the highest in the OECD club of mostly rich countries, at $1,174 per person—more than twice as much as in Britain. Voters have grown tired of the price- gouging. Over the past five years, prices of the 20 most-prescribed brand-name drugs have rocketed at ten times the rate of inflation. Out-of-pocket costs, the cash payments made for treatment that are not covered by health-insurance premiums, have spiked. For these reasons, health care has been the subject of nearly half of all political advertisements on television in the run-up to the mid-terms.
On October 25th President Donald Trump unveiled a new pitch for reducing drug prices: letting Medicare, the government health programme for the elderly, set prices based on an international index. Unlike previous runs at controlling the costs, the proposal would be carried out by regulatory fiat and therefore would not require an act of Congress, a crucial distinction if the proposal is to stick, given the number of pharmaceutical lobbyists loitering round the Capitol.
The proposal is sensible, though limited. It applies only to drugs covered by Part B of Medicare, representing just 5% of drug costs in America. “You can reference to other countries, but what are other countries doing? They’re having very structured negotiations with pharmaceutical companies about the value of a drug,” says Shawn Bishop of the Commonwealth Fund, a health-policy think-tank. “This is rational—this is something America can do. If we’re so exceptional, we could even do it better,” she adds. This modest scheme, along with an earlier rule requiring drug companies to disclose prices in television advertisements, constitutes the Republican Party’s closing argument on health care ahead of the elections on November 6th.
The ideas are serious enough to have prompted howls from pharmaceutical lobbyists, who have issued apocalyptic warnings about “foreign price controls from countries with socialised health-care systems that deny their citizens access and discourage innovation”. Forget for a moment that rich countries with socialised health-care systems have higher life expectancies than America. Exorbitant drug prices owe less to wondrous innovation than interference with normally functioning markets: pharmaceutical companies engage in anti-competitive behaviour, such as paying off generic-drug manufacturers to delay production after patents expire, refusing to grant enough sample drugs to generic producers, and creating “patent thickets” that successfully ward off competitors. Humira, a top-selling immunosuppressant, is ensconced in a web of 100 interlocking patents.
Democrats, who have pushed policies similar to the president’s for years, claim to be unimpressed. “The president’s policy proposal around drug-price reduction, coming in the closing days of a competitive campaign where he’s afraid that he may lose the House of Representatives, is too little too late,” says Hakeem Jeffries, a Democratic congressman representing New York. “When Democrats are in the majority, we can have a real conversation about how to drive down the high cost of prescription-drug prices.” Mr Jeffries says Democrats would begin by giving Medicare the ability to bargain directly for lower drug prices, which it cannot do now.
So sue me
Health care is a tricky subject for Republicans standing in the mid-terms. They have spent nearly a decade raging against the Affordable Care Act (ACA), a sweeping reform better known as Obamacare that is now enjoying a spurt of popularity. Before the ACA, insurance companies were able to deny coverage to people with pre-existing medical conditions. Reversing that has now become yet another live rail. So some candidates have turned to dissembling.
Josh Hawley, the Republican attorney-general in Missouri, who is running for a Senate seat, put out a touching campaign ad saying that he would protect people with pre-existing conditions because his eldest son has one. In fact Mr Hawley is, along with other Republican state attorneys-general, party to a lawsuit that seeks to overturn the entire ACA. Although Mr Trump insists that “Republicans will totally protect people with Pre-Existing Conditions, Democrats will not!”, his administration is not walking the tweet. The White House is pushing “short-term” health-insurance policies available for three years, which would not comply with the ACA.
By drawing off healthier patients, these plans are expected to increase premiums for those with pre-existing conditions. The administration seems to be doing its utmost to destabilise the health-insurance exchanges created by Obamacare by cutting funding for outreach, ditching the requirement that everyone must get insurance and stopping legally required reimbursement payments to insurance firms. Weary voters are understandably fuzzy on these details, but retain their impression of a dysfunctional health-care system that is growing more so.