Trump blasts drugmakers, middlemen for high U.S. drug prices

WASHINGTON, May 11 (Reuters) - U.S. President Donald Trump on Friday blasted drugmakers and healthcare "middlemen" for making prescription drugs unaffordable for Americans, but healthcare stocks rose as experts said the administration avoided taking aggressive and direct measures to cut drug prices.

Trump said his administration would take aim at the "middlemen" in the drug industry who became "very very rich," an apparent reference to health insurers and pharmacy benefit managers. He also said the pharmaceutical industry is making an "absolute fortune" at the expense of American taxpayers.

"Everyone involved in the broken system - the drugmakers, insurance companies, distributors, pharmacy benefit managers, and many others -- contribute to the problem," Trump said.

Shares of the major U.S. companies in each of those sectors rose after the speech, with the S&P 500 healthcare sector, a broad gauge of large healthcare stocks, up 1.4 percent.

Trump also placed blame on foreign governments, which negotiate lower drug prices than in the U.S., saying they "extort" unreasonably low prices from U.S. drugmakers.

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Epileptics suffer from medicine shortage
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Epileptics suffer from medicine shortage
Lusnay Echezuria, embraces her daughter Arioska Torres, 3, a neurological patient being treated with anticonvulsants, at their house in Caracas, Venezuela January 30, 2017. REUTERS/Carlos Garcia Rawlins 
Norymar Torres (C) carries her son Leonardo Colmenares, 6, a neurological patient being treated with anticonvulsants, while she asks for medicine at a pharmacy in Caracas, Venezuela February 10, 2017. REUTERS/Carlos Garcia Rawlins 
Norymar Torres, feeds his son Leonardo Colmenares, 6, a neurological patient being treated with anticonvulsants, at their house in Caracas, Venezuela January 16, 2017. REUTERS/Carlos Garcia Rawlins 
Leonardo Colmenares, 6, neurological patient being treated with anticonvulsants, is kissed by his grandmother at his house in Caracas, Venezuela February 9, 2017. REUTERS/Carlos Garcia Rawlins 
Miguel Anton (C) baths his son Jose Gregorio Anton, 11, a neurological patient being treated with anticonvulsants, at their house in La Guaira, Venezuela February 15, 2017. REUTERS/Carlos Garcia Rawlins 
Norymar Torres (R), holds the hand of her son Lorenzo, 5, and carries her son Leonardo, 6, who is a neurological patient being treated with anticonvulsants, while they wait for transportation on the street in Caracas, Venezuela January 24, 2017. REUTERS/Carlos Garcia Rawlins 
Norymar Torres carries her son Leonardo Colmenares, 6, neurological patient being treated with anticonvulsants, while they travel on public transport in Caracas, Venezuela January 18, 2017. REUTERS/Carlos Garcia Rawlins 
Jose Gregorio Anton (R), 11, a neurological patient being treated with anticonvulsants, is kissed by a neighbour at his house in La Guaira, Venezuela February 15, 2017. REUTERS/Carlos Garcia Rawlins 
Karla Martines carries her son Jose Gregorio Anton, 11, a neurological patient being treated with anticonvulsants, while they ride in a car in La Guaira, Venezuela February 20, 2017. REUTERS/Carlos Garcia Rawlins 
Miguel Anton (L covered) holds his son, Jose Gregorio Anton, 11, a neurological patient being treated with anticonvulsants, while workers takes a picture to him for his ID in La Guaira, Venezuela February 20, 2017. REUTERS/Carlos Garcia Rawlins 
Miguel Anton (C) feeds his son Jose Gregorio Anton, 11, a neurological patient being treated with anticonvulsants, at their house in La Guaira, Venezuela February 20, 2017. REUTERS/Carlos Garcia Rawlins 
Ismael Blanco, 6, a neurological patient being treated with anticonvulsants, sucks his thumb while he sleeps during an electroencephalogram in a clinic in La Guaira, Venezuela February 4, 2017. REUTERS/Carlos Garcia Rawlins 
Miguel Anton (L) comforts his son Jose Gregorio Anton, 11, a neurological patient being treated with anticonvulsants, after a blood test at a clinic in La Guaira, Venezuela February 20, 2017. REUTERS/Carlos Garcia Rawlins 
Iberis Vargas (L), holds her 7-month-old daughter, Geovelis Ramos, a neurological patient being treated with anticonvulsants, during an electroencephalogram in a clinic in La Guaira, Venezuela February 4, 2017. REUTERS/Carlos Garcia Rawlins 
Jineth Estevez (C), carrying her son Carlos Baute, 2, pays for a neurological consultation and a electroencephalogram for him, at a clinic in La Guaira, Venezuela February 4, 2017. REUTERS/Carlos Garcia Rawlins 
Iberis Vargas (R), holds her 7-month-old daughter, Geovelis Ramos, a neurological patient being treated with anticonvulsants, while an specialist examines her in a clinic in La Guaira, Venezuela February 4, 2017. REUTERS/Carlos Garcia Rawlins 
Isabel Buelvas, carries her grandson Kaleth Heredia, 2, a neurological patient being treated with anticonvulsants, at their house in Caracas, Venezuela January 30, 2017. REUTERS/Carlos Garcia Rawlins 
Kaleth Heredia, 2, neurological patient being treated with anticonvulsants, is carried by his grandmother Isabel Buelvas at their house in Caracas, Venezuela January 30, 2017. REUTERS/Carlos Garcia Rawlins 
Tatiana Rocha (C), plays with her son Kaleth Heredia, 2, a neurological patient being treated with anticonvulsants, at a park in Caracas, Venezuela February 10, 2017. REUTERS/Carlos Garcia Rawlins 
Isai Rocha (L), 14, kisses his brother Kaleth Heredia, 2, neurological patient being treated with anticonvulsants, before going out, at their house in Caracas, Venezuela January 31, 2017. REUTERS/Carlos Garcia Rawlins 
Tatiana Rocha feeds her son Kaleth Heredia, 2, neurological patient being treated with anticonvulsants, at their house in Caracas, Venezuela February 3, 2017. REUTERS/Carlos Garcia Rawlins 
Tatiana Rocha (L), feeds her son Kaleth Heredia, 2, neurological patient being treated with anticonvulsants, at their house in Caracas, Venezuela February 3, 2017. REUTERS/Carlos Garcia Rawlins 
Tatiana Rocha, baths her son Kaleth Heredia, 2, a neurological patient being treated with anticonvulsants, at their house in Caracas, Venezuela February 8, 2017. REUTERS/Carlos Garcia Rawlins TPX IMAGES OF THE DAY SEARCH "EPILEPSY CARACAS" FOR THI
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Trump was speaking as his health deputies released a series of proposals to address high drug costs.

The Department of Health and Human Services released what it called a blueprint titled "American Patients First" with details of its plan. It said the administration's immediate actions would include allowing commercial plans that administer Medicare Part D prescription drug benefits for seniors more power to negotiate prices with drugmakers.

The U.S. Food and Drug Administration would evaluate requiring drugmakers to include the list prices they set on medicines in their advertising. Drugmakers argue that list prices do not reflect actual cost with discounts and rebates.

Some of the administration's longer-term priorities include restricting use of rebates, creating incentives for drugmakers to lower list prices in Medicare, and investigating tools to address foreign government practices that it said could be harming innovation and driving up U.S. prices.

Healthcare experts said Trump's plan sounded like rhetoric rather than substantive change for an industry where prices rise substantially more than inflation each year.

"There's not a big proposal here that is going to make a huge difference. There are a bunch of smaller technical changes," said Sam Richardson, Associate Professor of Economics at Boston College.

Regarding forcing other countries to pay more for drugs, Richardson said: "We don't really have the policy levers to get that to happen."

Health and Human Services Secretary Alex Azar said during a White House briefing that many of the actions the government was considering would not require the U.S. Congress, but could take place through executive action within months. He said it would take years to restructure the U.S. drug system.

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President Trump's executive orders
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President Trump's executive orders

May 1, 2017

Presidential Executive Order on the Establishment of the American Technology Council

(Photo credit should read MANDEL NGAN/AFP/Getty Images)

April 29, 2017

Presidential Executive Order Addressing Trade Agreement Violations and Abuses

(Photo by Evelyn Hockstein/For The Washington Post via Getty Images)

April 29, 2017

Presidential Executive Order on Establishment of Office of Trade and Manufacturing Policy

(Photo credit should read JIM WATSON/AFP/Getty Images)

April 28, 2017

Presidential Executive Order Implementing an America-First Offshore Energy Strategy

(Photo by Eric Thayer-Pool/Getty Images)

April 27, 2017

Presidential Executive Order on Improving Accountability and Whistleblower Protection at the Department of Veterans Affairs

(Photographer: Olivier Douliery/Pool via Bloomberg)

April 26, 2017

Presidential Executive Order on Enforcing Statutory Prohibitions on Federal Control of Education

(Photo by Jabin Botsford/The Washington Post via Getty Images)

April 26, 2017 

Presidential Executive Order on the Review of Designations Under the Antiquities Act

(Photo credit should read BRENDAN SMIALOWSKI/AFP/Getty Images)

April 25, 2017 

Presidential Executive Order on Promoting Agriculture and Rural Prosperity in America

(Photo by Olivier Douliery-Pool/Getty Images)

April 21, 2017 

Presidential Executive Order on Identifying and Reducing Tax Regulatory Burdens

(Photo by Mark Wilson/Getty Images)

April 18, 2017

Presidential Executive Order on Buy American and Hire American

(Daniel Acker/Bloomberg via Getty Images)

March 31, 2017

Presidential Executive Order Regarding the Omnibus Report on Significant Trade Deficits

(REUTERS/Carlos Barria)

March 31, 2017

Presidential Executive Order on Providing an Order of Succession Within the Department of Justice

(REUTERS/Yuri Gripas)

March 29, 2017

Presidential Executive Order Establishing the President’s Commission on Combating Drug Addiction and the Opioid Crisis

(REUTERS/Jonathan Ernst)

March 28, 2017

Presidential Executive Order on Promoting Energy Independence and Economic Growth

(Photo by Ron Sach-Pool/Getty Images)

March 27, 2017

Presidential Executive Order on the Revocation of Federal Contracting Executive Orders

(Photo credit should read MANDEL NGAN/AFP/Getty Images)

March 13, 2017

Presidential Executive Order on a Comprehensive Plan for Reorganizing the Executive Branch

(REUTERS/Carlos Barria)

March 6, 2017

Executive Order Protecting The Nation From Foreign Terrorist Entry Into The United States

(Photo by Mark Wilson/Getty Images)

February 24, 2017

Presidential Executive Order on Enforcing the Regulatory Reform Agenda

(Photo by Olivier Douliery - Pool/Getty Images)

February 9, 2017

Providing an Order of Succession Within the Department of Justice

(Andrew Harrer/Bloomberg via Getty Images)

February 9, 2017

Presidential Executive Order on Enforcing Federal Law with Respect to Transnational Criminal Organizations and Preventing International Trafficking

(REUTERS/Aaron P. Bernstein)

February 9, 2017

Presidential Executive Order on Preventing Violence Against Federal, State, Tribal, and Local Law Enforcement Officers

(Andrew Harrer/Bloomberg via Getty Images)

February 9, 2017

Presidential Executive Order on a Task Force on Crime Reduction and Public Safety

(Photo by Olivier Douliery - Pool/Getty Images)

February 3, 2017

Presidential Executive Order on Core Principles for Regulating the United States Financial System

(Photo by Cheriss May/NurPhoto via Getty Images)

January 30, 2017

Presidential Executive Order on Reducing Regulation and Controlling Regulatory Costs

(REUTERS/Carlos Barria)

January 28, 2017

Presidential Executive Order on Ethics Commitments By Executive Branch Appointees

(Photo credit should read MANDEL NGAN/AFP/Getty Images)

January 27, 2017

Presidential Executive Order on Protecting the Nation from Foreign Terrorist Entry Into the United States

(Photo by Mark Wilson/Getty Images)

January 25, 2017

Presidential Executive Order on Border Security and Immigration Enforcement Improvements

(Chip Somodevilla/Pool via Bloomberg)

January 25, 2017

Presidential Executive Order on Enhancing Public Safety in the Interior of the United States

(Photo by Jabin Botsford/The Washington Post via Getty Images)

January 24, 2017

Presidential Executive Order Expediting Environmental Reviews and Approvals For High Priority Infrastructure Projects

(Photo credit should read JIM WATSON/AFP/Getty Images)

January 20, 2017

Presidential Executive Order on Minimizing the Economic Burden of the Patient Protection and Affordable Care Act Pending Repeal

(REUTERS/Joshua Roberts)

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Healthcare stocks were volatile during Trump's speech, with shares of companies involved in the pharmaceutical supply chain, such as Express Scripts Holding Co and CVS Health Corp , hitting session lows. But those stocks quickly reversed course, with Express Scripts shares up 2.4 percent and CVS up 3 percent.

(Reporting by Yasmeen Abutaleb in Washington, additional reporting by Caroline Humer, Lewis Krauskopf and Michael Erman in New York; editing by Bill Berkrot)

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