Speaker 1: This is Bloomberg Law with June Grossel from Bloomberg Radio.
Speaker 2: I'm announcing a historic action to rescue our nation's capital
Speaker 2: from crime, bloodshed, bedlam, and squalor and worse. This is
Speaker 2: Liberation Day in DC, and we're going to take our
Speaker 2: capital back. We're taking it back.
Speaker 3: Even as official Washington DC Police data shows violent crime
Speaker 3: reached a thirty year low last year and is down
Speaker 3: twenty six percent this year, President Trump declared a public
Speaker 3: safety emergency today and invoked a never before used power
Speaker 3: in DC's Home Rule Act to take over its police department.
Speaker 2: They love to spit in the face of the police.
Speaker 2: As the police are standing up there in uniform. They're
Speaker 2: standing and they're screaming at him an inch away from
Speaker 2: their face, and then they start spitting in their face.
Speaker 2: And I said, you tell them you spit and we hit,
Speaker 2: and they can hit real hard.
Speaker 3: Trump is also sending eight hundred National Guard troops onto
Speaker 3: the streets of the nation's capital. My guest is George
Speaker 3: Derrick Musgrove, a professor of history at the University of Maryland,
Speaker 3: Baltimore County. Does the president have the power to do this?
Speaker 4: The President actually has a tremendous amount of power under
Speaker 4: the Home Rule Act, and he's going to operate within
Speaker 4: that realm. So he's going to send out National Guard
Speaker 4: troops onto the streets of DC, as well as the
Speaker 4: smattering of federal agents from other agencies. That's all within
Speaker 4: his legal purview under the Home Rule Act in nineteen
Speaker 4: seventy three, which gives the President control of the DC
Speaker 4: National Guard and in emergency situation allows him to take
Speaker 4: over the Metropolitan Police Department for up to thirty days.
Speaker 3: Tell us a little bit more about the Home Rule.
Speaker 4: So the Home Rule Act, which was fass in nineteen
Speaker 4: seventy three by Congress, gives the city a local government,
Speaker 4: the mayor, a thirteen member council, and a number of
Speaker 4: other local offices. And it does that for the first
Speaker 4: time in about one hundred years. And so the eighteen
Speaker 4: seventy four Congress ended local governance in the District of
Speaker 4: Columbia and initiated one century period where the President basically
Speaker 4: ran the city through three appointed commissioners. That became an
Speaker 4: embarrassment after World War Two, and so Congress moved to
Speaker 4: slowly but surely returned certain elements of democracy to the district.
Speaker 4: The kind of the capstone of that process was for
Speaker 4: the Home Rule Act. What the president cannot do is
Speaker 4: simply wipe that law away. It was passed by Congress.
Speaker 4: It has to be repealed or altered by Congress. But
Speaker 4: again within the purview of the law, the president actually
Speaker 4: has a significant amount of power over law enforcement the city,
Speaker 4: and that was done intentionally by Congress. And so aside
Speaker 4: from his control of the National Guard and his ability
Speaker 4: to essentially bring the Metropolitan Police Department under his control,
Speaker 4: he also appoints the US Attorney who is the chief
Speaker 4: law enforcement officer in the district that we don't have
Speaker 4: district attorneys here in the nation's capital, and so the
Speaker 4: US Attorney prosecutes pretty much all adult crimes, all felonies.
Speaker 3: And how long can he take over the DC Police Department.
Speaker 4: He can do it for a period of up to
Speaker 4: thirty days. After that, the assumption is that any emergency
Speaker 4: that the President would need to take over the police
Speaker 4: department for would have passed. But he is capable of
Speaker 4: doing that. He was talked off the ledge of doing
Speaker 4: that back in twenty twenty during the Black Lives Matter
Speaker 4: protests outside the White House. Again claims as he's doing now,
Speaker 4: that there was an emergency in the district and that
Speaker 4: he should take pretty radical measures in order to address
Speaker 4: that emergency, and so he very closely considered over the MPD.
Speaker 4: Then he was dissuaded from doing so by local elected
Speaker 4: officials as well as some of his advisors, and instead
Speaker 4: he just deployed the National Guard and several other federal
Speaker 4: assets in order to clear Lafayette Park, which I think
Speaker 4: many people at the time in hindsight saw it as
Speaker 4: a pretty robust violation of the First Amendment right to
Speaker 4: the people protesting.
Speaker 3: There are there any restrictions on the president's use of
Speaker 3: the National Guard.
Speaker 4: There's not restrictions in the law. There are, however, larger
Speaker 4: problems with using the Guard in urban policing context. I mean,
Speaker 4: the Guard is not trained for urban policing. It's not
Speaker 4: even particularly well equipped for urban policing. And the other
Speaker 4: problem that he has, which he's really not addressing in
Speaker 4: any way, shape or form, is that the National Guard
Speaker 4: regularly collaborates with the Metropolitan Police Department pretty much on
Speaker 4: every inauguration. Back in the late nineteen eighties and early
Speaker 4: nineteen nineties, the National Guard actually helped the police with
Speaker 4: crime suppression, because at that point, the DC did have
Speaker 4: a pretty robust crime crisis. But the National Guard, understanding
Speaker 4: its limitations and MPD understanding the problem of putting uniformed
Speaker 4: soldiers on the street, made sure that the National Guard
Speaker 4: during that period pretty much only did support the work,
Speaker 4: and MPD stuck with all the law enforcement work and
Speaker 4: interacting with the public. And that's because all of those
Speaker 4: examples that I just gave, the National Guard was cooperating
Speaker 4: with local authorities. The federal authorities were coordinating with the
Speaker 4: mayor and with the council. What's unique about the deployment
Speaker 4: in twenty twenty, and also the one that he announced today,
Speaker 4: is that the White House is not just not coordinating
Speaker 4: with local authorities, but is actively seeking to undermine through
Speaker 4: its deployment of federal assets to the city.
Speaker 3: Is this similar to Trump sending troops and the National
Speaker 3: Guard into Los Angeles and the legality of that is
Speaker 3: going to be decided at a trial this week.
Speaker 4: Yes, I mean this is very similar, not just the
Speaker 4: Los Angeles, but I would also argue New York. And
Speaker 4: so the President has pretty consistently not just during his
Speaker 4: first term and now and to his second but for
Speaker 4: much of his adult life attacks large democratic cities as
Speaker 4: crime ridden, as stilthy, and as a place that were
Speaker 4: he in charge of them, he would clean up with
Speaker 4: an iron fist, And that rhetoric has become more focused
Speaker 4: and more specific once he got into elected office, and
Speaker 4: so he's gone after those places once he got official power.
Speaker 4: You can see this in Los Angeles with the Ice raid,
Speaker 4: where he's essentially going around the local government, creating a
Speaker 4: crisis and then sending in the National Guard to try
Speaker 4: and address that crisis. You can see this in New York,
Speaker 4: where he is really using the Justice Department in a
Speaker 4: criminal manner to get the mayor, Eric Adams in his
Speaker 4: pocket so that he can have relatively free reign in
Speaker 4: the city. And the one place where he's already allowed
Speaker 4: to do this stuff without having to go around or
Speaker 4: budget the law is Washington, DC, because he already has
Speaker 4: a significant amount of power in the city, and so
Speaker 4: he appears to be planning to use at least a
Speaker 4: portion of that power.
Speaker 3: So any ruling in the LA trial won't apply to DC.
Speaker 4: Then, correct, The President has way more power in the
Speaker 4: federal District than he does pretty much anywhere else in
Speaker 4: the United States, and that's specifically enshrined in the Home
Speaker 4: Rule Act. But again, there is what's legal and there's
Speaker 4: what's right, and I think the President is towing the
Speaker 4: line at least when it comes to what's legal. He
Speaker 4: is not doing that when it comes to what's right.
Speaker 3: This move apparently stems from a carjacking of a former
Speaker 3: Doege employee, and the President declared a public safety emergency.
Speaker 3: Is he the final word on whether they is an emergency?
Speaker 4: Well, I mean, it wasn't even a carjacking. It was
Speaker 4: an alleged attempted carjacking that was actually stopped by an
Speaker 4: MPD officer. I mean, the whole reason we have a
Speaker 4: clear record of this is because an MPD officer saw
Speaker 4: the alleged crime taking place, intervened and probably saved mister
Speaker 4: Korustine from much horse beating and perhaps the loss of
Speaker 4: his property, which speaks to me to a relatively good
Speaker 4: policing regime here in the city. But the answer to
Speaker 4: your question is, unfortunately no. The Home Rule Act, like
Speaker 4: most laws in this country, was written with the assumption
Speaker 4: that the person carrying them out in this case, the President,
Speaker 4: would be a gentleman and a statesman and wouldn't just
Speaker 4: lie to get their way. And so the Home Rule
Speaker 4: Act is written to say that if the President determines
Speaker 4: that there is an emergency, he is able to take
Speaker 4: emergency control of a metropolitan police department. That leaves the
Speaker 4: determination with the president unfortunate, and so that's where we are.
Speaker 3: Trump has also threatened that if Zoran Mandami wins the
Speaker 3: mayoral race in New York City, he's going to take
Speaker 3: over that city.
Speaker 4: The president does, not, to my mind, have legal authority
Speaker 4: to take over an American city. DC is a unique
Speaker 4: case because it is the federal district. But that sounds
Speaker 4: like bluster and misdirections.
Speaker 3: Me looking at history. Have any other presidents tried to
Speaker 3: do something similar in DC?
Speaker 4: Yes, and no. There was a push primarily by Congress,
Speaker 4: not by the president, in the eighteen seventies district the
Speaker 4: district of democracy entirely, and that was successful, and so
Speaker 4: in eighteen seventy four Congress repealed all democracy in the
Speaker 4: district and then gave the power to the president to
Speaker 4: administer it directly. There was also a pretty big push
Speaker 4: by the Nixon administration to campaign against the district in
Speaker 4: nineteen sixty eight as the quote unquote crime capital of
Speaker 4: the United States, and when he got into office, he
Speaker 4: put together a very robust anti crime package that DC
Speaker 4: residents roundly rejected. The difference between then and now, though,
Speaker 4: is that the district didn't have a home rule government
Speaker 4: in nineteen sixty nine when Nixon begins to implement these policies.
Speaker 4: And the other is that there were liberals in Congress
Speaker 4: with power who were willing to push back against the
Speaker 4: president's initiatives. We don't have those circumstances now. If the
Speaker 4: president takes these powers, it is a violation at least
Speaker 4: of the spirit, if not the letter, of the law
Speaker 4: of home rule. And when it comes to Congress, you
Speaker 4: really don't have people in power in the Republican majority
Speaker 4: who have any intention of checking the president's whims when
Speaker 4: it comes to these situations.
Speaker 3: But it does appear that what Trump is doing here
Speaker 3: is all legal.
Speaker 4: Well, the only thing I'd underscore is that I think
Speaker 4: that we've become quite numb to the president many in
Speaker 4: various efforts to violate the rights of those Americans with
Speaker 4: whom he does not agree. So when he began speaking
Speaker 4: of federalizing the district, the question that many people asked
Speaker 4: was not should he do it? But can he do it?
Speaker 4: And I think it's important to not only ask can
Speaker 4: he do it, which unfortunately he can, but should he
Speaker 4: do it? So to remind folks that this is not
Speaker 4: a violation of the law, but it is a violation
Speaker 4: of our principles, of our principles of no taxation without representation,
Speaker 4: of our principles of every citizen has a specific set
Speaker 4: of rights that other citizens shouldn't look to violate, and
Speaker 4: the President is violating those principles in a very robust
Speaker 4: and unfortunate manner.
Speaker 3: Thanks for joining me on the show. Thanks so much
Speaker 3: for joining me on the show. That's George Derrick Musgrove,
Speaker 3: a professor of history at the University of Maryland, Baltimore County.
Speaker 3: Coming up next on the Bloomberg Law Show, Trump is
Speaker 3: threatening to impose tariffs of up to two hundred and
Speaker 3: fifty percent on pharmaceutical imports. What are the potential consequences.
Speaker 3: I'm June Grosso and you're listening to Bloomberg. President Trump
Speaker 3: is threatening to impose tariffs of up to two hundred
Speaker 3: and fifty percent on pharmaceutical imports. He said there would
Speaker 3: be an initially small tariff, and then in a year
Speaker 3: or at most a year and a half, the tariffs
Speaker 3: will go up to one hundred and fifty percent and
Speaker 3: then up from there. It's not the first time that
Speaker 3: Trump has threatened to impose steep tariffs on pharma. Here
Speaker 3: he is at the National Republican Congressional Committee President's dinner
Speaker 3: in April.
Speaker 2: We're going to tariff for our pharmaceuticals. And once we
Speaker 2: do that, they're going to come rushing back into our
Speaker 2: country because with a big market.
Speaker 3: Trump wants more farmer companies to manufacture their drugs in
Speaker 3: the United States. Joining me is healthcare attorney Harry Nelson
Speaker 3: of Leech Tishman Nelson Hardiman. Harry start by telling us
Speaker 3: about these threatened tariffs on drugs.
Speaker 1: President Trump is threatening these tariffs up to two hundred
Speaker 1: and fifty percent on pharmaceutical tariffs. He's using this Section
Speaker 1: two point thirty two right to claim a national security
Speaker 1: interest under the theories that the shrinkage in US production
Speaker 1: of drugs is a national security risk and that these
Speaker 1: tariffs will sort of force drug companies to build infrastructure
Speaker 1: in the United States to ensure access to the drug
Speaker 1: supply and prevent disruption. So that's the theory behind this plan.
Speaker 1: But in the short term, he's planning to, you know,
Speaker 1: essentially significantly increase the price of all imported drugs to
Speaker 1: create the incentive to make that happen.
Speaker 3: Why do you think he's targeting pharmaceuticals in particular.
Speaker 1: I think the pharmaceutical industry is first of all, it's
Speaker 1: just a massive part of our overall economy. But I
Speaker 1: also think this is a way to get attention. And
Speaker 1: I think we've had a history, even from President Trump's
Speaker 1: first administration, where drug prices were seen as a threat,
Speaker 1: something that upsets consumers. And I think ultimately, even though
Speaker 1: people ultimately need American consumers need medications, they're kind of
Speaker 1: an easy target to pick on from a popularity standpoint.
Speaker 3: Trump wants more FORMA companies to manufacture their drugs in
Speaker 3: the US, but already three companies, Johnson and Johnson, Astrazenica,
Speaker 3: and Eli Lilly said they would spend fifty five billion,
Speaker 3: fifty billion, and twenty seven billion, respectively on expanding drug
Speaker 3: manufacturing here.
Speaker 1: Yeah, say pharmaceuticals that you're mentioning, you know, which are
Speaker 1: already essentially global companies. They're all responding that they want
Speaker 1: to increase the production capacity in the United States at
Speaker 1: the same time that they're threatening that this is going
Speaker 1: to really hurt patients, urt healthcare providers access to medication,
Speaker 1: and really hurt R and D research and development. But
Speaker 1: they are responding and trying to, you know, to give
Speaker 1: a signal that they're prepared to ramp up their US
Speaker 1: based production.
Speaker 3: I mean, will this increase the cost of pharmaceuticals to
Speaker 3: consumers if he puts these tariffs on absolutely.
Speaker 1: First of all, we should say, even before he does
Speaker 1: anything specific, we're already looking at, you know, a different
Speaker 1: teriffs of aning on what part of the world you're
Speaker 1: talking about. But we already have EU tariffs at fifteen percent,
Speaker 1: India twenty five percent. I think China's at ten percent,
Speaker 1: So there already is you know, a lower level tariffs
Speaker 1: that are but obviously we're talking about potentially increasing these
Speaker 1: as much as twenty five times. So either American consumers
Speaker 1: are already paying the price increases or the drug manufacturers
Speaker 1: are containing you know these and just taking a hit
Speaker 1: on their bottom line. But this is obviously a dramatic
Speaker 1: going from ten to fifteen percent to two hundred and
Speaker 1: fifty percent. It's pretty radical.
Speaker 3: He said, other nations make a fortune on pharmaceuticals, citing
Speaker 3: drugs imported from China and Ireland. Is that true? And
Speaker 3: don't pharmaceutical companies in the US make a fortune as well?
Speaker 1: Yeah? Obviously, like there are a lot of US companies
Speaker 1: making a lot of money on drug It's interesting that
Speaker 1: reference to Ireland is super interesting. Ireland is, among other things,
Speaker 1: notably producing some of the GLP one weight loss drugs
Speaker 1: that are just surging in demand. You know, some of
Speaker 1: glue tides, there's eppetide, and so you know, when we
Speaker 1: talk about China and India, we're talking much more about
Speaker 1: the generics. And so the reality is like our drug
Speaker 1: supply is fairly multinational between Europe and Asia. Yes, these
Speaker 1: countries are producing a lot of the drugs and inherently
Speaker 1: making profits that come from those drugs. But it's not
Speaker 1: like we don't have any US manufacturing. It's just a
Speaker 1: question of how much of what the alocation is today
Speaker 1: and what he wants it to be.
Speaker 3: Has he said what he wants it to be, It
Speaker 3: sounds like he.
Speaker 1: Wants it to be something like one hundred percent of
Speaker 1: the US or ninety ten. But it's interesting question. I
Speaker 1: haven't seen exact data, but I think it's spared to
Speaker 1: say that the majority of drugs that Americans are consuming
Speaker 1: are imported. Depending on how you measure, you know, whether
Speaker 1: you're measuring revenue or actual production, the percentage is going
Speaker 1: to be different. But it definitely is the case that
Speaker 1: we have more foreign sources. He's certainly trying to reverse
Speaker 1: that and make make sure that the overwhelming majority of
Speaker 1: drugs are coming from US production.
Speaker 3: On July thirty first, he sent letters to seventeen drug
Speaker 3: companies urging them to lower drug prices. US drug prices
Speaker 3: by September twenty ninth to most favored nation amounts paid
Speaker 3: by other nations. What does that mean?
Speaker 1: Most favored nation is just a reference to essentially, whatever
Speaker 1: the best pricing that a particular company is offering in
Speaker 1: the marketplace it has to offer to the United States.
Speaker 1: So this has been a particular Again, this is a
Speaker 1: theme that went back to the first Trump administration, which
Speaker 1: is that America essentially props up the pharmaceuticals by paying
Speaker 1: higher prices for drugs. We know that Medicare, for example,
Speaker 1: has limitations that prohibit the Medicare program, the US government
Speaker 1: from negotiating with drug manufacturers over certain prices. We saw
Speaker 1: legislation and the Biden administration to begin to allow negotiations
Speaker 1: on some drugs. But the point here is that most
Speaker 1: favorite nation and status would mean that the US would
Speaker 1: not be subsidizing drug costs drug development costs for the
Speaker 1: rest of the world and allowing them to take much
Speaker 1: cheaper costs while Americans and insurance companies absorbed all those
Speaker 1: additional expenses.
Speaker 3: Will you explain a little more detail how the US
Speaker 3: is subsidizing the development costs for other countries.
Speaker 1: Right what's happening, essentially is that because we have certain
Speaker 1: government programs, most notably in Medicare, that are locked into
Speaker 1: paying certain very high costs for drug companies and not
Speaker 1: being able to negotiate. And if you think about their
Speaker 1: purchasing power, you know, the Medicare program is without question
Speaker 1: the single largest purchaser of drugs. So I think since
Speaker 1: the data is that you know, in many cases, particularly
Speaker 1: on brand name prescription drugs, the US and the Medicare
Speaker 1: program is paying two and a half to three times
Speaker 1: higher than other advanced industrialized countries, and so in many cases,
Speaker 1: basically two hundred and fifty percent over foreign drug prices.
Speaker 1: It might be that that two hundred and fifty percent
Speaker 1: tariff that President Trump is referencing was based on that
Speaker 1: data point alone. And you know, the argument that the
Speaker 1: drug companies make is that are paying these higher prices
Speaker 1: here in America helps sustain their innovation, their drug development,
Speaker 1: helping you know, patients around the world who can't afford it.
Speaker 1: But the reality is, when you look at other advanced
Speaker 1: industrialized countries, including you know, the European Union for example,
Speaker 1: there's no explanation why we should be bearing that higher burden. Essentially,
Speaker 1: you know, the argument is that when we pay for
Speaker 1: drugs with public funded research in the US as well,
Speaker 1: that we're essentially paying the burden once you know, in
Speaker 1: terms of our tax level, and then another time at
Speaker 1: the pharmacy. It's an effort to rebalance. I think the.
Speaker 3: Real solution would be to change the medicare laws.
Speaker 1: That would be one huge piece of the puzzle, allowing
Speaker 1: the government to negotiate for fair pricing. I think another
Speaker 1: just another data point here is that supposedly, I think
Speaker 1: the number is seventy five percent of global drug company
Speaker 1: profits come from their US sales, so you can imagine
Speaker 1: there's a lot of room to negotiate pricing downward where
Speaker 1: the drug companies can still do just find and make
Speaker 1: a reasonable return on their investments from the Medicare program
Speaker 1: without us having to carry, you know, their entire profitability
Speaker 1: and worry about their shareholders. So it seems like a
Speaker 1: rational move to allow the Medicare program and other large
Speaker 1: governmental programs to negotiate like anybody else in the marketplace
Speaker 1: over what the fair price is. But you know, the
Speaker 1: drug companies have lobbied to prevent that from happening for
Speaker 1: a long time now.
Speaker 3: So I was going to ask you why they can't negotiate,
Speaker 3: and I guess it was the lobbying by the drug
Speaker 3: companies that stops that.
Speaker 1: Yeah, the drug companies are certainly one of the most
Speaker 1: powerful groups. They've had bipartisan support, and you know, they've
Speaker 1: used the amazing advances that we've made in pharmaceutical research
Speaker 1: and innovation and particularly getting cutting edge drugs, life saving,
Speaker 1: really game changing drugs on many medications into the market
Speaker 1: to fund massive amounts of hundreds of millions of dollars
Speaker 1: of lobbying Congress to support them, and we have not
Speaker 1: yet seen a real turn, you know, on the part
Speaker 1: of Congress, And one of the really interesting questions will
Speaker 1: be how far you know President Trump may be able
Speaker 1: to change that.
Speaker 3: Drug companies have said that tariffs might disrupt international supply chains.
Speaker 3: Is there a possibility that if tariffs are imposed, people
Speaker 3: will not be able to get the drugs that they need.
Speaker 1: Well, I mean, I think the question is going to
Speaker 1: be who's going to bear the burden of these if
Speaker 1: prices increase when we say two hundred and fifty percent,
Speaker 1: we're basically seeing increasing prices twenty five times. So obviously,
Speaker 1: if you're a hospital, for example, and you need to
Speaker 1: buy injectable drugs to have the inventory for when patients
Speaker 1: need particular drugs or cancer drugs, you know, the question
Speaker 1: is who's going to pick up that cost? If an
Speaker 1: injectable drug went from costing twenty dollars today to all
Speaker 1: of a sudden five hundred dollars proper single file or whatever,
Speaker 1: you know, just patient, that's a dramatic problem. And you
Speaker 1: can imagine that budgets from hospital reimbursement from insurance companies
Speaker 1: are going to limit uptake and it's going to take
Speaker 1: time to build new facilities in the US not subjects
Speaker 1: to the shriffs. That might take years, and so in
Speaker 1: the meantime, you can imagine that there's going to be
Speaker 1: a point where certain drugs just won't be available certain
Speaker 1: hospitals and in certain parts of the US.
Speaker 3: I mean, we should point out that the White House
Speaker 3: previously pledged to impose steep tariffs on pharmaceuticals and later
Speaker 3: backed off, so this could just be floating this look.
Speaker 1: I think certainly President Trump got everyone's attention in terms,
Speaker 1: you know, and that's been the pattern. We hear extreme
Speaker 1: numbers as part of a negotiating position, and then ultimately
Speaker 1: negotiated settlements for lower numbers when there's outcry from the
Speaker 1: industry from voters. And I do expect that we will
Speaker 1: see some smaller tariff, probably more in the zone of
Speaker 1: ten to twenty twenty five percent, applied to select products,
Speaker 1: and I think probably some exemptions for drug with critical
Speaker 1: shortages in terms of supplies. I don't think the administration
Speaker 1: is looking to trigger shortages and lawsuits and to antagonize seniors,
Speaker 1: particularly because so many medications for chronic conditions are really
Speaker 1: an issue for seniors, which is why Medicare is such
Speaker 1: a big so I do think we're going to end
Speaker 1: up with something much narrower. But this is a very
Speaker 1: effective way to put pressure and get attention on this issue,
Speaker 1: even if it's creating a little bit of anxiety for
Speaker 1: many of us along the way.
Speaker 3: Harry, just how concerning do you find these threats of
Speaker 3: potential tariffs on drugs?
Speaker 1: Whether you're a patient or on the provider's side. It
Speaker 1: should be paying close attention to this issue. But there's
Speaker 1: still I think a lot of game left to be
Speaker 1: played on it. I mean, I think the question is
Speaker 1: going to be who's going to bear the burden of
Speaker 1: these if prices increase. When we say two hundred and
Speaker 1: fifty percent, we're basically saying increasing prices twenty five times.
Speaker 1: So obviously, if you're a hospital, for example, and you
Speaker 1: need to buy injectable drugs to have the inventory for
Speaker 1: when patients need particular drugs or cancer drugs, you know,
Speaker 1: the question is who's going to pick up that cost?
Speaker 1: If an injectable drug went from costing twenty dollars today
Speaker 1: to all of a sudden five hundred dollars, that's a
Speaker 1: dramatic problem. And you can imagine that budge it from
Speaker 1: hospital reimbursement from insurance companies are going to limit uptake,
Speaker 1: and it's going to take time to build new facilities
Speaker 1: in the US not subjects to the sheriffs. That might
Speaker 1: take years, and so in the meantime, you can imagine
Speaker 1: that there's gonna be a point where certain drugs just
Speaker 1: won't be available at certain hospitals and in certain parts
Speaker 1: of the US.
Speaker 3: You're going to stay with me, Harry. Coming up next
Speaker 3: on the Bloomberg Law Show, I'll continue this conversation with
Speaker 3: healthcare attorney Harry Nelson. Will turn to Health and Human
Speaker 3: Services Secretary Robert F. Kennedy Junior and the latest in
Speaker 3: his anti vaccine campaign. I'm June Grosso and you're listening
Speaker 3: to Bloomberg. Let's turn now to Robert F. Kennedy Junior,
Speaker 3: the Secretary of Health and Human Services.
Speaker 5: For years, wherepublicans and Democrats have been talking about how
Speaker 5: to reorganize the healthcare system, whether it should be private
Speaker 5: insurance but a single payer, or a public private hybrid.
Speaker 5: All of those ideas are like moving deck chairs around
Speaker 5: on the Titanic. The ship is going down.
Speaker 3: That was Kennedy talking to a bipartisan group of governors
Speaker 3: in Colorado springs at the end of last month. Last week,
Speaker 3: Kennedy said that HHS was going to pull nearly five
Speaker 3: hundred million dollars worth of contracts with universities, drug companies,
Speaker 3: and other labs working on new mRNA vaccines. Kennedy said
Speaker 3: the funds would be shifted toward quote safer, broader vaccine platforms.
Speaker 3: I've been talking to healthcare attorney Harry Nelson of Leech
Speaker 3: Tishman Nelson Hardiman. What's the impact of this.
Speaker 1: Yeah, that activity on vaccines is on the targeting by
Speaker 1: this administration is potentially very disruptive. A lot of it
Speaker 1: will depend on what we see in terms of any
Speaker 1: future you know, spread of viruses. You know, I think
Speaker 1: this is the is really potentially limiting supply on some
Speaker 1: of the seasonal drugs. You know. The real question is
Speaker 1: like what's going to happen with the latest variance. You know,
Speaker 1: COVID is still continuing to what's called mutate every season
Speaker 1: along with all the influenza vaccines, and so I do
Speaker 1: think this is a kind of a high risk move
Speaker 1: and there could be significant backlash if there is some
Speaker 1: kind of an outbreak or a particularly harsh season, But
Speaker 1: you know, until that happens, it doesn't seem like there's
Speaker 1: public outcry quite yet, and I think it will sort
Speaker 1: of depend on how things actually develop on a public
Speaker 1: health lovel He.
Speaker 3: Said the vaccines quote failed to protect effectively against upper
Speaker 3: respiratory infections like COVID and flu. What is he basing
Speaker 3: that on? Is that true?
Speaker 1: I mean, I think there is still some divide among
Speaker 1: researchers about how effective the mRNA vaccines are. I'm not
Speaker 1: quite sure. I think it's clear that he's putting his
Speaker 1: thumb on the scale, you know, on an issue where
Speaker 1: there is some divide among public health experts and then
Speaker 1: the infectious to these community and the time is going
Speaker 1: to bear out whether we have the level of preparedness
Speaker 1: that we need, you know, for the next major problem
Speaker 1: on this front. But it's a little bit scary to
Speaker 1: see just sort of the political choices that seem to be,
Speaker 1: you know, driving us rather than any scientific evidence based
Speaker 1: decision making.
Speaker 3: Correct me if I'm wrong with the mrn A vaccine
Speaker 3: was the reason why they were able to fight COVID
Speaker 3: so fast, right, the operation warp speed.
Speaker 1: Yeah, absolutely, the mRNA vaccines that we were able to
Speaker 1: develop really allowed for a massive acceleration so that we
Speaker 1: had vaccines in the marketplace by early twenty twenty one already,
Speaker 1: you know, basically less than a year after the global
Speaker 1: spread of COVID nineteen. And I think that it's clearly
Speaker 1: is the fastest adaptable platform for new viral threats. So
Speaker 1: scrapping that investment is not putting us in a good
Speaker 1: position for preparedness. It's certainly not giving us, the United States,
Speaker 1: a lead on being able to respond to the next
Speaker 1: threat that we face. And I think we're gonna see
Speaker 1: how it plays out. You know, hopefully we won't see
Speaker 1: some kind of tragic disaster that where we're caught flat
Speaker 1: footed by this rollback.
Speaker 3: But I time will tell you know, he's a vaccine
Speaker 3: denier or a vaccine skeptic. What else has he done
Speaker 3: to inhibit vaccinations.
Speaker 1: There's also been a lot of policy shifting on, for example,
Speaker 1: moving away from vaccine recommendations for children, for pregnant women.
Speaker 1: There has been a kind of a halt to other
Speaker 1: kinds of god government preparation. So it's there's been quite
Speaker 1: a bit of other activity by RFK and by his team,
Speaker 1: obviously internally massive restructuring, so a lot of the personnel
Speaker 1: who were responsible for public health emergency response on this
Speaker 1: front are no longer in their jobs. We've seen it
Speaker 1: appears that some of the messaging and the public marketing
Speaker 1: campaigns for people to get vaccinated are being cut. He
Speaker 1: eliminated public comment on policy, and so it's a lot
Speaker 1: of like internal administrative things happening within the Department of
Speaker 1: Health and Human Services that are really you know, sort
Speaker 1: of silencing in many ways the vaccine advocacy coming from
Speaker 1: within the federal government.
Speaker 3: And has he also ended other kinds of grants for
Speaker 3: research projects.
Speaker 1: Yeah, absolutely, that's been well, not only Kennedy, but some
Speaker 1: of it is happening, you know, within for example, National
Speaker 1: Institutes of Health. But we've seen just massive cuts affecting
Speaker 1: most large research universities. The Health and Human Services grant
Speaker 1: cuts are I haven't seen the latest target, but I
Speaker 1: have heard from multiple researchers at large academic medical centers
Speaker 1: this is it's hitting every center. Grants canceled, you know,
Speaker 1: labs shuttered, and just a whole range of cuts that
Speaker 1: are likely to have some significant impact on public health
Speaker 1: research and on all kinds of drug related projects and.
Speaker 3: I understand that there was a commission, a bipartisan commission
Speaker 3: that Warren Congress in April that China has already pulled
Speaker 3: ahead of the US and some key life sciences area.
Speaker 3: I mean, is talent starting to leave the US because
Speaker 3: the funding isn't here anymore.
Speaker 1: There's been a lot of talk about whether, you know,
Speaker 1: we are taking a backseat to China. I haven't seen
Speaker 1: data about most US researchers heading to China, so but
Speaker 1: there is there's no question that we are essentially seeding
Speaker 1: a lot of leadership here to to China. And you know,
Speaker 1: just whether it's it's researchers actually migrating, which I'm skeptical
Speaker 1: how much you know researchers will be excited to move
Speaker 1: to China, or just you know, the relative significant funding
Speaker 1: that's continuing in China with broadcuts here having more of
Speaker 1: an impact.
Speaker 3: Kennedy also going to target the Federal Vaccine Court, which
Speaker 3: I think most people have never heard of.
Speaker 1: Yeah, I mean that that's on his list. I don't
Speaker 1: think there's a single part of the vaccine infrastructures that
Speaker 1: he's not directly targeting in one way or another as
Speaker 1: part of his Make America Healthy Again campaign.
Speaker 3: So he did promise not to during his confirmation hearings.
Speaker 3: Thanks so much, Harry. That's healthcare attorney Harry Nelson of
Speaker 3: Leach Toishman Nelson Hardiman. And that's it for this edition
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