Last Tuesday January 31st President Donald Trump met with several major pharmaceutial company CEOs to address issues like high drug prices, the FDA drug approval process, and bringing drug manufacturing back to the US in order to increase jobs.

After the meeting four of the CEO’s had their Q4 2016 results earnings investor calls. During the calls the CEOs discussed their meeting with President Trump. Below you will find the key highlights on what they said. Also, PhRMA’s CEO commented on the meeting which I included at the end.

Kenneth C. Frazier, CEO, Merck & Co.,

I came away encouraged by the open and constructive dialogue of this first meeting. We discussed how we can work together on areas of common ground, such as: reforming our country’s tax code, removing outdated and counterproductive regulations that drive up costs and hinder biomedical progress, using market forces like competition and choice to make medicines more affordable and accessible to the patients who need them, all with the ultimate goal of stimulating greater innovation and growth on the part of U.S.-based companies.

In addition:

• The President was really clear that his ultimate goal is two fold. One is to create U.S. jobs, and the second one is to ease the cost burden on patients.
• He recognizes the importance of this industry, and he doesn’t want to interfere with the incentives in the marketplace for us to continue to take risks and make the kinds of investments that are needed to discover and develop long-term innovation.
• The administration is focused on repealing and replacing the ACA, and they’re very early in that thought process.
• What we heard in that meeting I think gives us a lot of confidence that the Trump administration does understand the challenges associated with research-based pharmaceutical industry growth going forward.
• What I heard from Mr. Trump was a concern less around the cost of drugs in the aggregate but more around how patients need to be able to afford their co-pays and things of that nature.

David Ricks, CEO, Eli Lilly:

• I was impressed with the President’s appreciation for what our industry is.
• There’s a number of follow-ups that were cited. The specifics on timing and so forth I’m not at liberty to share here
• I think it was productive to engage with the President and it was educational for both sides.
• PhaRMA has recently put out some work on the total drug spend in the nation and how much of that is innovative, generic, or going into the channel. This was referenced in the meeting and I think the President was interested in that.
• Mostly we discussed how to get value to consumers who particularly in the ACA plans or in high-deductible plans have limited formularies. They think they bought insurance and they have limited coverage or are paying a lot of out-of-pocket costs, and how to address that situation.

Robert Bradway, CEO, Amgen

• The president was very clear about his desire to promote innovation on behalf of patients, economic growth and job creation.
• The president and his team recognized the leading role the United States has played in the field of biotechnology, and we share their desire to strengthen the environment for employees and employers in this sector.
• We’ve long supported corporate tax reform as a way to level the playing field with our ex US competitors.
• We look forward to being part of the policy discussions with the new administration around tax as well as regulatory reform, intellectual property protection and trade policy.
• We will seek to advance changes that enable more Americans to have affordable access to life saving and cost effective medicines.
• I think this President takes seriously what he’s said about regulatory reform. And I suspect that will be reflected in his choice of a leader for the FDA.
• Genuinely I think that those of us that were there were encouraged by the level of interest that the President has in our businesses and in our industry.
• He’s also been very clear that drug pricing is something that’s important to him, and that I’m sure he’s going to want to be able to deliver real benefits to the American public on that score.

Ian C. Read, CEO, Pfizer Inc. ( Could not attend the meeting because of investor call. However, he made the below comments)

• The President said, well, number one, you need to get manufacturing back to America, so that falls squarely inside of getting a tax reform which allows us to reinvest in the United States and create jobs.
• He’s going to cut up to 80% of all FDA regulation to help streamline the approval process. That will help with drug prices, because it’ll induce more competition. We have been advocating for a long time to speed up the approval of generics and remove the barriers to their approval, because that will help with drug prices.
• Cost to patients is driven by the fact that the out-of-pocket expense on average for a patient to visit a hospital is 3%, but on his drug bill it’s 15%. So we’d like to see regulations that would allow that unfair playing field to be squared up. It’d be positive to get a new FDA head and very positive if we can get to the market quicker. And that’s good for us and good for the whole system.
• We have a regulation that was created for fee-for-service, and now we need regulations in a new world of value-based pricing.

Stephen J. Ubi, CEO PhMRA

• We talked about how we can work together to improve American competitiveness around the world, create more jobs here at home and enhance the U.S. biopharmaceutical industry that continues to lead the world in the development of lifesaving treatments and cures.
• We discussed many areas of common ground including: Advancing stronger trade agreements to level the playing field with countries around the world; reforming our tax code to spur investment and job creation here in the United States; and removing outdated regulations that drive up costs and slow innovation.
• We believe if these policies are enacted, it will translate to up to 350,000 new jobs over the next 10 years as a result of growth in the biopharmaceutical industry.
• We also talked about how we can work together on health care reform to give consumers more choices and create a more competitive healthcare marketplace.
• The current system needs to evolve to enable the private sector to lead the move to a value-driven health care system. To do this, we need to reform existing laws and regulations that are currently preventing private companies from negotiating better deals and paying for medicines based on the value they provide to patients and our health care system.

Overall the comments from the CEOs during the investor call were positive. One topic that got quite a bit of press coverage following up the meeting was that President Trump said government-set prices may be off the table. However, he suggested that Medicare price bidding may still be a possibility.

“I’ll oppose anything that makes it harder for smaller, younger companies to take the risk of bringing their product to a vibrantly competitive market,” Trump told them. “That includes price-fixing by the biggest dog in the market, Medicare, which is what’s happening. But we can increase competition and bidding wars.”

The content for the above information comes from Seeking Alpha, PhRMA website and Bloomberg.

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About the author: Salvador Carlucci is the Founder of Atacana Group, a boutique agency focused on Competitive Intelligence and Strategy. He is the former Global Head of Competitive Intelligence for Roche. Prior to that he was the Global Head of Competitive Intelligence for Novartis.