Americans for Tax Reform today released a coalition letter signed by 80 free market, conservative, and libertarian groups and activists in opposition to President Donald Trump’s recent “Most Favored Nation” executive order.
If implemented, the order would impose an “International Pricing Index” on Medicare Part B drugs, tying American drug prices to the prices in foreign countries with government-run healthcare systems.
President Trump has repeatedly stood strong against the left’s calls for socialized medicine, even promising in the 2020 State of the Union Address that “we will never let socialism destroy American healthcare.”
Unfortunately, an MFN policy would adopt these same socialist healthcare policies and threaten American medical innovation. As the letter notes:
Adopting these price controls will slow medical innovation, threaten American jobs, and undermine criticism of single-payer systems. In addition, a United States embrace of price controls will make it immeasurably more difficult to get foreign countries to pay their own way in the development of new medicines.
An MFN policy would also threaten our COVID-19 response and exacerbate foreign freeloading off of American innovation. As the letter notes:
The U.S. is the best in the world when it comes to developing innovative, lifesaving and life preserving medicines. Because of this, the U.S. is leading the way when it comes to developing COVID-19 vaccines, with several promising candidates entering the final stages of testing and clinical trials.
In contrast, foreign countries have been free riding off this American medical innovation for decades through crushing price controls and other market-distorting government rules and regulations.
The MFN order would also harm our economy through a decrease in research and development. Medical innovation directly or indirectly supports 4 million jobs and $1.1 trillion in total economic impact, which will be threatened by importing price controls from foreign countries.
Finally, the letter urges President Trump to apply the same successful, deregulatory, market-based approach that he has championed in other policy areas to health care:
As President, you have championed vital changes in tax and regulatory policies that have allowed free market innovation to flourish. We believe a market-based approach like those that your administration has consistently supported in other policy areas will lead to economic growth and promising new treatments, but adopting price controls through the MFN plan would undermine rather than build on those successes.
Click here to read the full letter.