Biden Administration Drug Price Negotiation : The Biden administration will soon release a list of 10 drugs for price negotiation. This is a significant step in reducing Medicare’s costly medications under the Inflation Reduction Act. The news is imminent due to a new law granting the federal government power to negotiate drug prices for older people.
The law aims to limit Medicare drug price increases. This is in response to lobbying by consumer and senior groups. Medicare used to determine payment for healthcare services, but a 2003 law prevented it from discussing drug prices. But the new law changed this situation.
Experts suggest that expensive drugs, such as those for cancer, heart disease, arthritis, and diabetes, may be subject to negotiations. But there are dates. Price changes for these ten medicines won’t occur until 2026. After this, 30 additional drugs will be selected in 2022 and 2023, with price discussions scheduled for 2027 and 2028. Leigh Purvis from AARP aims to target popular or expensive drugs.
Despite the significance of these changes, the pharmaceutical industry resists. AstraZeneca, Bristol Myers Squibb, J&J, Merck, and PhRMA have challenged the talks legally. The resistance is strengthened by legal actions from the U.S., Michigan, and Ohio chambers of business.
Legal challenges argue against drug talks for various reasons. AstraZeneca’s Delaware lawsuit claims that the Inflation Reduction Act’s drug negotiation provisions contradict the Orphan Drug Act, which promotes investments in rare disease treatments. Dave Fredrickson, EVP of oncology at AstraZeneca, said continued drug talks may delay access to medical breakthroughs for U.S. patients compared to others.
Many believe the long case list speeds up Supreme Court hearings. Kelly Bagby from the AARP Foundation said, “They want maximum momentum to reach the Supreme Court quickly.”
Patients, especially older people on important medications, closely monitor these changes. Ellen Farmer from Massachusetts, who requires Xarelto, hopes these talks will reduce drug prices. Even with insurance, high costs can make people choose between health and financial security.Medicare’s negotiation ability is limited by the law. After nine years, the price of a retail drug can be negotiated. There is a 13-year window for prescribed drugs.
The talks’ results won’t be clear until 2026, but the rule has other benefits. By 2025, Medicare Part D out-of-pocket costs will be $2,000/year. This year, Medicare patients’ insulin costs were capped at $35 per dose, and three major insulin makers announced significant price reductions.
The law mandates pharmaceutical companies to provide government rebates for price increases exceeding inflation. Officials believe this will reduce prices for consumers and save money for Medicare.
The Inflation Reduction Act isn’t only for Medicare recipients. Leigh Purvis claims this law could save taxpayers $173 billion in the next decade. Good news for taxpayers.