Medicare Previews Plan To Penalize Drugmakers That Hike Prices Beyond Inflation
The Biden administration released new details Thursday on how Medicare will use new powers from the Inflation Reduction Act to claw back refunds from companies that increase prescription drug prices at a rate that outpaces inflation starting in 2025.
Stat:
Medicare Details Forthcoming Penalties For Drug Price Hikes
The Biden administration on Thursday offered the first glimpse into how it’s planning to enact a new law that will penalize drugmakers for hiking their prices faster than inflation. The initial guidance documents for both physician-administered and pharmacy drugs offer details about the formulas that officials plan to use to calculate the penalties, and the process for fines if drugmakers don’t comply. The guidance is open for public comment until March 11, the administration said. (Cohrs, 2/9)
NPR:
Medicare Announces Plan To Recoup Billions From Drug Companies
Medicare's historic plan to slow prescription drug spending is taking shape. Thursday federal health officials released proposed guidance that outlines the first of a pair of major drug price reforms contained in the Inflation Reduction Act. Those reforms are projected to save Medicare roughly $170 billion over the next decade. President Joe Biden touted the effort underway earlier this week in his State of the Union address. "We're taking on powerful interests to bring your health care costs down so you can sleep better at night," he said. (Walker and Gorenstein, 2/9)
Healthcare Finance News:
Drug Companies To Pay Rebates For Prices That Go Higher Than Inflation
This is the nation's first prescription drug law for companies to pay rebates to Medicare when drug prices increase faster than the rate of inflation. The Inflation Reduction Act, which passed in August 2022, allows Medicare to negotiate drug prices for 10 high-cost drugs starting in 2026. (Morse, 2/9)
Also —
Stat:
Generics Makers Fought Drug Price Reform, But May End Up Benefiting
Generic drugmakers lobbied hard against Democrats’ new law empowering Medicare to negotiate prescription drug prices. Giving the government such power seemed like an admission that generic medicines don’t do enough to keep costs down. Now that the changes are law, however, industry experts and lobbyists acknowledge the package is more of a mixed bag for generics makers like Teva and Sandoz, not an existential threat. (Wilkerson, 2/10)
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Senate Panel Passes Drug Patent Reforms, But Not Without Dissent
The Senate Judiciary Committee on Thursday passed legislation to prevent drug companies from gaming the patent system to delay competition from cheaper generics, but members in both parties said they still have concerns about the reforms. (Wilkerson, 2/9)
