Dive Deep Into the Biden Administration’s Drug Price Negotiations
August 30, 2023
The Biden administration has announced the selection of 10 high-cost prescription drugs for price negotiations with pharma companies to help older and disabled Americans afford their medication. The controversial move is a step towards addressing Medicare’s drug pricing issue. President Biden hailed the move as a significant policy win, asserting that Americans should not have to pay more than other developed nations for vital drugs. The drug companies’ response has been mixed, with firms like Johnson & Johnson expressing concern over potential impacts on innovation and intellectual property rights.
The ten chosen drugs are Eliquis, Xarelto, Jardiance, Januvia, Farxiga, NovoLog, Enbrel, Stelara, Entresto, and Imbruvica. Companies have until October 1 to express their interest in participating in negotiations.
The negotiation process will involve data and information discussion, listening sessions, and offering presentations toward a “maximum fair price.” If no agreement is reached, up to three negotiation meetings can take place until August 1, 2024, and the negotiated prices will come into effect from January 1, 2026.
Approximately 9 million seniors using Medicare’s prescription drug program use one or more of these ten drugs, with out-of-pocket costs totaling $3.4 billion last year. Factors for price negotiation will include the drug’s clinical benefit, the cost of research and development, and its impact on Medicare-dependent people.
Drug companies that do not participate in the negotiations or agree to a maximum fair price could face hefty taxes or exclusion from Medicare and Medicaid.
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[Source: The Washington Post, August 29th, 2023]
