President Trump sure has ironic timing. On Sunday Gilead Sciences announced a $21 billion offer to buy Immunomedics , which recently launched a breakthrough therapy for hard-to-treat metastatic breast cancer. Hours later Mr. Trump signed an executive order that could make other life-saving therapies less likely.

Mr. Trump has been threatening drug makers for months with government price controls. He thinks targeting Big Pharma is a good election issue, though he’ll never get to the left of Speaker Nancy Pelosi and Joe Biden.

The President’s order directs the Department of Health and Human Services to require drug makers to give Medicare the “most favored nation” (i.e., lowest) price that other economically developed countries pay. Other government health systems “secure bargain prices, leaving Americans to make up the difference—effectively subsidizing innovation and lower-cost drugs for the rest of the world,” the order states.

This ignores some crucial details. Government health systems pay less than what private insurers in the U.S. do, but drug makers are by law required to give Medicare, Medicaid and hospital pharmacies hefty discounts that can increase nominal prices. For Medicaid these discounts offset half of drug costs.

Other countries also have to wait longer for breakthrough therapies, which is one reason the U.S. has much higher cancer survival rates. The five-year survival rate for brain cancer in the U.S. is 36.5% compared to 26.3% in the U.K. and 27.2% in France. Novel immunotherapies for metastatic melanoma reduced mortality in the U.S. by 17.9% among whites (who make up most cases) between 2013 and 2016, among the largest declines for any cancer anywhere.



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