In San Francisco, the pharmaceutical industry is urging President-elect Donald Trump and Congress to address concerns over Medicare’s ability to negotiate drug prices. Industry leaders are also advocating for reforms to curb rebates paid to pharmacy benefit managers (PBMs) in exchange for favorable coverage placement. These changes would likely require Congressional action through standalone legislation or broader bills.
CEO’s of major drug companies express optimism after Trump’s comments on eliminating PBMs during a meeting with pharma executives. Efforts to prohibit PBMs from receiving rebates based on Medicare list prices were previously considered in legislation but ultimately removed. Consumers are frustrated by high co-pays linked to inflated drug list prices set by manufacturers, rather than the actual net costs after discounts and rebates.
PBMs argue that they negotiate prices with drugmakers to lower medication costs and help patients save money. Industry lobbying group PhRMA is advocating for policies to disconnect PBM payments from list prices, pass rebates to patients at the point of sale, and increase transparency on rebates and fees.
Biopharma companies are also seeking changes to the Inflation Reduction Act of 2022, aiming for parity in the treatment of oral drugs and biologic medicines regarding Medicare price negotiation timelines. The industry is pushing for a unified 13-year timeline for all drugs, citing concerns of incentivizing more expensive treatments. PhRMA is advocating for administrative changes to the IRA and clarifying that not all drugs with the same active ingredient should be subject to price negotiation, especially when approved for different indications.
The pharmaceutical drug Wegovy is currently subject to existing regulations that also anticipate its availability at a negotiable cost. “Many aspects of the drug pricing policy framework are inadequately developed,” stated Pope, underscoring that slim Republican majorities in both legislative chambers could necessitate Democratic backing for their policy initiatives – some of whom participated in formulating the IRA. Ubl expressed, “There appears to be bipartisan willingness to address certain shortcomings. The specifics of potential legislation remain unclear at this point.” (Reporting By Deena Beasley; Editing by Caroline Humer and Bill Berkrot)
