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CAPD Statement on the Administration’s Executive Order on Rebates


Today, the Coalition for Affordable Prescription Drugs released the following statement regarding the Administration’s new Executive Order on rebates:

Pharmacy benefit managers work every day to protect Americans, including millions of seniors who access their medication through Medicare Part D, from the high and rising prices set by Big Pharma. By utilizing rebate dollars they negotiate from pharmaceutical manufacturers, PBMs keep Part D premiums low and limit the impact of Big Pharma’s price hikes, a fact that multiple government reports have validated. Despite PBMs’ proven record of negotiating savings for seniors, President Trump signed a series of Executive Orders, one of which directs the Secretary of Health and Human Services (HHS) to restart its failed rulemaking process to eliminate these rebates. HHS’ own estimates have determined that this policy would cause seniors’ Part D premiums to spike, with some estimates finding that premiums could rise by a staggering 25%, and government spending to skyrocket. A provision in the Executive Order requires that the Secretary of HHS cannot move forward with the policy unless they certify that it does not increase premiums or government spending, which is an impossibility. All of this grandstanding comes in the middle of a pandemic that is disproportionately affecting seniors and putting budgetary pressure on governments and taxpayers alike.

This Executive Order fails to address the root cause of high drug prices: the prices set and continuously increased by Big Pharma. Instead, the Administration is pursuing action that will impact seniors, taxpayers and the stability of Medicare Part D, just when we need it most. As millions of Americans feel the effects of COVID-19 and seniors continue to struggle with sky-high drug prices, the Administration should do everything possible to keep drug prices low, not hand a multibillion-dollar windfall to Big Pharma. Because HHS’ own estimates conclude this action will lead to higher premiums for seniors, HHS should abandon the policy.