In August 2022, President Biden signed into law the Inflation Reduction Act. The Act’s key provisions include the ability of the federal government to negotiate certain prescription drug pricing. Specifically, the law created a program that allows the federal government to negotiate prices for a limited number of high-cost single-source drugs (lacking generic and/or biosimilar substitutions). The Secretary of the Department of Health and Human Services (HHS) will have the ability to choose a list of 50 pharmacy drugs and 50 drugs administered at a physician’s office that will be priced in accordance with this new methodology.
By September 1, 2023, the Centers for Medicare and Medicaid Services (CMS) must publish the highest cost drugs for negotiation. While the effective date for this first round of drugs is not until CY2026, in CY2023 a total of 10 drugs will be selected from the Medicare Part D program.
In this recent article published by Reuters entitled Bristol Myers, Pfizer, AbbVie Drugs Likely to Face U.S. Price Negotiation, the authors discuss some of the drugs anticipated to be on this initial list and the efforts being made by the industry to better understand how this new pricing system will be implemented.