
Reaction Mixed After CMS Unveils Negotiated Medicare Drug Prices
Key Takeaways
- CMS negotiated lower Medicare prices for 10 drugs, aiming for $1.5 billion in savings by 2026.
- Supporters praise the initiative for reducing out-of-pocket costs and improving access to essential medications.
Some groups praised CMS after it announced the 10 negotiated Medicare drug prices while others criticized its potential impacts on drug competition and development.
CMS recently
President Joe Biden
CMS
The following are the 10 drugs and their negotiated prices1:
- Apixaban (Eliquis; Bristol Myers Squibb/Pfizer): $231 (56% discount from list price)
- Empagliflozin (Jardiance; Boehringer Ingelheim/Lilly): $197 (66%)
- Rivaroxaban (Xarelto; Janssen): $197 (62%)
- Sitagliptin (Januvia; Merck): $113 (79%)
- Dapagliflozin (Farxiga; AstraZeneca): $178.50 (68%)
- Sacubitril/valsartan (Entresto; Novartis): $295 (53%)
- Etanercept (Enbrel; Amgen): $2335 (67%)
- Ibrutinib (Imbruvica; Pharmacyclics/Johnson & Johnson): $9319 (38%)
- Ustekinumab (Stelara; Janssen Biotech): $4695 (66%)
- Insulin aspart (Fiasp, Fiasp FlexTouch, FiaspPenFill, NovoLog, NovoLog FlexPen, NovoLog PenFill; Novo Nordisk): $119 (76%)
These prices will go into effect by 2026 for patients enrolled in Medicare prescription drug coverage, with an estimated $1.5 billion in overall savings expected under the standard benefit design.4 These savings are in addition to other IRA cost savings, like the first cap on out-of-pocket drug costs for Medicare beneficiaries.
Some groups applauded the negotiated prices, like the
"While Trump and his Republican allies in Congress want to leave Big Pharma in charge so seniors pay higher prices, Democrats have delivered lower costs, more consumer protections, and accountability of drug companies that raise prices with impunity," Wyden said.
Similarly, the American College of Rheumatology (ACR)
"While there is still more to be done to reduce prescription drug costs, we are greatly encouraged by the important step this initiative takes in helping seniors afford the medications they need to manage their rheumatic conditions," Desir said.
Conversely, other groups responded more negatively, including the
However, CMS chose ustekinumab as 1 of the 10 drugs for negotiation despite several Stelara biosimilars set to launch in 2025. Consequently, Reed asked CMS to follow the intent of the IRA and remove Stelara from the list to allow patients access to lower-cost biosimilars.
"The Forum supports lower drug prices for patients, and we believe free market competition is the best way to achieve this," Reed said. "CMS has the opportunity to promote competition that lowers prices and increases access for patients through lower-cost drugs, like biosimilars. Biosimilars can save the US health care system up to $133 billion by next year if they are accessible."
The
Additionally, he noted that CMS did not disclose what evidence it used when negotiating prices, whether it listened to clinicians or patients, or its plan to protect patient access and out-of-pocket spending. O'Brien explained that this information is important since CMS's actions affect the entire market. Therefore, it could potentially impact investment decisions in new medicines and prices charged by private insurers.
"Our research suggests the IRA will reduce the number of conditions new medicines are approved to treat and limit postapproval research used to establish treatment guidelines, while encouraging plans to limit access," O'Brien said. "We'll be watching what happens over the coming months and conducting new research about the impact of this law."
Similarly, the Pharmaceutical Research and Manufacturers of America (PhRMA)
Also, Ubl explained that there are fewer Medicare Part D plan options with increasing premiums due to the IRA. Meanwhile, PBMs and insurers are covering fewer medicines and intend to impose further coverage restrictions once the negotiated prices go into effect. Therefore, more than 3 million beneficiaries who take drugs with government-set prices will pay more in 2026.
Lastly, he said pharmaceutical companies began changing their research programs due to the IRA. Experts predict this will result in fewer treatments, including those for mental health, cancer, and rare diseases.
"The ironically named Inflation Reduction Act is a bad deal being forced on American patients: higher costs, more frustrating insurance denials, and fewer treatments and cures for our loved ones," Ubl said.
References
1. Santoro C. Lower drug prices announced under Medicare negotiation program. The American Journal of Managed Care®. August 15, 2024. Accessed August 16, 2024.
2. Negotiating for lower drug prices works, saves billions. CMS. August 15, 2024. Accessed August 16, 2024.
3. Mattina C. CMS releases list of 10 drugs subject to price negotiation under IRA. AJMC®. August 29, 2023. Accessed August 15, 2024.
4. Medicare drug price negotiation program: negotiated prices for initial price applicability year 2026. CMS. August 15, 2024. Accessed August 16, 2024.
5. Wyden cheers lower drug prices for seniors through Medicare negotiation. US Senate Committee on Finance. August 15, 2024. Accessed August 16, 2024.
6. ACR applauds lower negotiated prices for arthritis drugs. American College of Rheumatology. August 15, 2024. Accessed August 16, 2024.
7. Quinn K. Biosimilars Forum calls on CMS to support lower-cost biosimilars and increase access for patients. Biosimilars Forum. August 15, 2024. Accessed August 16, 2024.
8. IRA & the Medicare Drug Price Negotiation Program. National Pharmaceutical Council. August 15, 2024. Accessed August 16, 2024.
9. PhRMA statement on government price setting in Medicare Part D. Pharmaceutical Research and Manufacturers of America. August 14, 2024. Accessed August 16, 2024.
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