President Trump’s speech in Cleveland Ohio is getting tons of attention for a short clip of him saying, “you may not see me for a while” which I cover at America First Projects. President Trump made the remark as he was explaining his plan to lower the price of prescription drug prices. President Trump spoke mysteriously of “middlemen” who “make more than the drug companies” who were going to be very unhappy with his plan.
Here is broader context of the clip that is getting all the attention where President Trump gives the details of his plan:
The plan is remarkably simple and it seems obvious that it will achieve the goal of lowering the cost of prescription drugs for the US Government and the American people. Trump will demand and negotiate that the drug companies must sell America prescription drugs at whatever the lowest rate it sells that drug to any country. Clues to the mechanism he plans to use to get it done can be found in the hurried comments that come just after the viral clip.
“No other President would do a favored nations, a rebate, a buy from other nations at much less cost,” President Trump concludes after talking about his very very rich enemies, the middlemen. “Nobody and there are a lot of very unhappy people, very rich people.”
Trump’s Plan For Lower Drug Prices: “Favored Nations”
The first cog of President Trump’s plan looks to be getting America a version of “Most-favored-nation clause” in deals with the Big Pharma. That clause would dictate that America pays whatever the lowest rate being given to any other country. Google defines Most-favored-nation clause as “agreements in which a supplier agrees to treat a particular customer no worse than all other customers”
The result will clearly lower prices and remove the primary burden on the American consumer to subsidize Pharma through increased pricing of equal products being offered to competing countries at a lower rate. As President Trump pointed out in his speech in Cleveland the same drug, “often manufactured in the same factory” will often be sold to America at a significantly higher price than other countries. Under Trump’s plan, if a factory in India sells one of the many generic drugs to say Mexico for seventy cents a pill, America will only pay seventy cents.
That means a lot of people who have gotten very rich “wetting their beak” by selling equal products to the United States for double or even triple the cost of equal items will be left out in the cold. President Trump refers to these parasitic entities as “middlemen” who “make more than the drug companies” in his remarks.
Trump’s Plan For Lower Drug Prices: “Rebates”
President Trump talks about lowering drug prices through rebates of money taken from the “middlemen” in the clip above. President Trump was clearly avoiding being specific about the people so rich and powerful that “we might not see him for a while”.
For much of 2020, I’ve been working on international deals for both PPE and generic prescription drugs as part of an incredible story I’ve been sitting on. Eastcann is an emerging markets cannabis fund I spent years working on, with a childhood friend and experienced import/export businessman globally, Brandon Bleach, in Singapore. The idea we started pursuing in 2016 was creating an investment fund to bring proven cultivation to retail products to new markets created when countries and jurisdictions begin the process of “legalizing” the cannabis plant for either CBD or THC. When we got word of what was happening in Wuhan we switched our focus to using the global connections we had cultivated to procure the PPE and other supplies we believed America was going to need to respond to the Kung Flu Coronavirus.
As part of building the emerging markets fund, we had connections in half a dozen countries with factories, cultivators, politicians, and regulators. We could source masks, suits, thermometers, hand sanitizer, pharmaceuticals, and just about everything else my connections at the Coronavirus Task Force headed by Vice President told me they were looking for. To the great confusion of Eastcann, our directly sourced and heavily inspected products lost bids where the government paid a significantly higher price than what Eastcann could offer.
We checked EVERY box of inspection and verification in a grueling negotiations only to lose out to people who charged a lot more. Was our connection to these products too direct? Who did we miss including to lose out on those deals? Friends sometimes hinted that it was NGO’s like the Bill and Melinda Gates Foundation and the World Health Organization WHO.
One glaring example is on the serologic Covid-19 test which at the time Eastcann could source in February and March for between $7 – $9 per test. While we were trying to find anyone we could to get the production under contract before the bigger panic set in, companies were selling the exact same kits for upwards of $20 and $30 a test.
The PPE Market is one of the first articles I wrote for PM Nightly News back when we were still building the website in this article way back in April.
Trump’s Plan For Lower Drug Prices: Buy From Other Nations
“You should really listen to what President Trump says about China” is another article I’m working on based on President Trump’s remarks. Based on the evidence that we have so far it would be foolish to trust China. In fact, that the Kung Flu Coronavirus originated in the only country that undercut the global markets of PPE and other medicines in both production capacity and cost is surely part of the reason President Trump says it’s still undetermined whether the plague from China was released “intentionally or by incompetence”.
It’s clear that America has been looking for new partners and India would be happy to fill the massive trade gap left with our falling out with China. With the way patent laws work many common generic drugs can be produced cheaply with these new trading partners.
Eastcann was working with a factory in India on one of those generic drugs that had long ago outlived it’s patent and could be produced for thirty or forty cents before the “China virus” paralyzed the world. It was very cool and our correspondence included the hope that this would deepen the bonds between our two countries.
President Trump’s plan to lower drug prices by buying from other countries will strengthen the foreign relations that are going to be necessary to confront China over the Kung Flu Coronavirus. (Dear censorship overlords, none of the language in this article goes beyond what the President of the United States is saying, which makes the use of these terms newsworthy)