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Obama Announces Agreement With Drug Companies

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By Michael A. Fletcher
Updated 1:07 p.m.
President Obama today announced an offer by drug manufacturers to contribute $80 billion over the next decade to narrow the controversial gap in Medicare prescription drug coverage, a deal the president said moves the nation a step closer to comprehensive health care reform.

"This is a significant breakthrough on the road to health care reform, one that will make the difference in the lives of many older Americans," Obama said as he made the announcement from the White House.

The president was joined at the White House today by Barry Rand, head of the influential senior citizens' advocacy group, AARP, which endorsed the deal.

"This is an early win for reform. It's a major step forward," Rand said.

Obama reiterated his vow to restructure the nation's health care system to expand care and slow the increase in long-term expenses, despite mounting concerns about the initial costs and structure of various plans that have been put forward. "And to those ... here in Washington who've grown accustomed to sky-is-falling prognoses and the certainties that we cannot get this done, I have to repeat and revive an old saying we had from the campaign: Yes, we can," Obama said. "We are going to get this done."

After weeks of secret talks, the pharmaceutical industry trade group voted Friday to dedicate $80 billion to lowering the price of medicines sold to seniors and the government. The unusual offer by the Pharmaceutical Research and Manufacturers of America (PhRMA) is part of its effort to convince skeptical lawmakers that it backs major health-care legislation.

Though the agreement represents a fraction of the total cost of health-care reform, it has been managed for maximum public relations exposure.

News of the PhRMA vote leaked out Friday night. On Saturday afternoon, Senate Finance Committee Chairman Max Baucus (D-Mont.) put out a news release announcing that he had "secured an $80 billion commitment" from drugmakers. Yesterday, the AARP let it be known it supported the action. Today, cameras were at a White House ceremony celebrating the accord.

When the Medicare prescription drug benefit approved by Congress went into effect in 2006, it left a coverage gap that charges seniors the full cost of medications once a patient has received $2,700 worth of drugs, until the total reaches about $6,100. At that point, "catastrophic" coverage kicks in and covers nearly all drug expenses.

By Web Politics Editor  |  June 22, 2009; 12:53 PM ET
Categories:  Health Care , Video Report  
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It's just another scam by "BIG MEDICINE" to stave off Government takeover. They are not giving up anything. Especially not Profits.
They will just jack up their prices somewhere else in the "System". If seniors get a break, it will be spread over the other age groups. they Know the AARP has enough "Pull", to bail them out again. Someday, (yea, right) Government will seize the Entire Health-care Industry, for the Public Good. It's called Eminent Domain.

Posted by: teganmcdonough | June 23, 2009 7:33 AM | Report abuse

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