The Pharmaceutical Research and Manufacturers of America (PhRMA) has agreed to cut prices on drugs purchased by Medicare in a symbolic gesture designed to show support for the Big O’s scheme to overhaul America’s Rube Goldberg health system.
In effect, Big Pharma is pledging to cut $80 billion off its charges to the Feds over the next 10 years, according to a Washington Post post source who requested anonymity.
“We applaud the president’s efforts on health care reform and are pleased to participate to expand access to medicines to seniors and disabled persons,” Kevin Sharer told the Post. Sharer was the chairman of PhRMA before becoming CEO at Amgen.
The proposal would affect 3.4 million elderly and disabled Americans that fall into the “doughnut hole,” a coverage gap in which Medicare patients end up paying the sticker price for brand-name drugs after incurring $2,200 in partially subsidized drug costs and before reaching a $5,100 outer limit, at which point the subsidies kick-in once again.
The proposal is that Big Pharma will offer 50% discounts to Medicare recipients that have fallen into the “doughnut hole,” and throw in some perks to bring the total cuts to $80 billion.
“This is real money on the table,” the source told the Post.
Big Pharma’s offer leaves the Big O to find another $920 billion to pay for the cost of the overhaul. Apparently he has made some serious coin in this regard by ordering inspections of the couches occupied by foreign dignitaries during White House visits.
Obama had hoped to snag $100 billion from Big Pharma, and some insiders feel the latter’s $80 billion offer amounted to a public negotiation ploy designed to save the industry the difference.
“There was a great deal of sticker shock” regarding the $100 billion proposal, according to a Big Pharma executive who also spoke on conditions of anonymity.