News & Views: 9/7 - 9/13

September 14, 2021

The Biden administration released their drug pricing plan called for in the Promoting Competition in the American Economy executive order.

The report is broken down into three guiding principles, including: (1) make drugs more affordable and equitable for all consumers; (2) improve and promote competition; and (3) foster innovation. Notably, the report calls for Medicare negotiation prices to be available in the commercial markets. In addition to aggressive Medicare negotiation, the report calls on Congress to pass various legislative priorities, including Part D benefit reform, slow down future price increases over time, and to increase biosimilar and generic approval. The administration action items focus on testing multiple models to improve Medicare Part B and D. To read the full report, click here.

The Senate has not released any drug pricing legislative text but is considering tying Medicare prices to Veterans Affairs (VA) prices.

While the House has continued to include an international pricing framework for Medicare negotiation, the Senate has been looking at alternative options. Previously, Senator Wyden showed interest in a domestic reference pricing model, but most recently senators are turning to VA prescription drug rates. These rates, known as the Federal Ceiling Price, are calculated by reducing the average price paid by non-government wholesalers by approximately one-quarter, according to STAT. To read the full article, click here.

House Committees have begun to introduce and markup their drug pricing legislation.

The House Energy & Commerce Committee added a measure that protects those in commercial insurance plans from prescription drug price increases. This version of the legislative text passes Medicare negotiation prices to the commercial market, but the previous version did not include any inflation rebate protections to the commercial market. This latest measure is in response to the employers insistence for some sort of protection against manufacturers. Ways and Means Committee Chairman Neal also released markup legislative text that includes Medicare negotiation as a reconciliation offset. To read the Energy and Commerce and Ways and Means markup texts, click here and here, respectively.

Employers urged Congress to protect workers throughout the reconciliation process.

The letter, signed by large employer groups, urged Chairman Wyden to include protections for workers by extending Medicare negotiation to the commercial market. The letter cites West Health surveys that found individuals under the age of 65 report difficulty affording medications at a higher rate than those enrolled in Medicare. To read the full letter, click here.

A group of 132 organizations, including groups who advocate for older Americans, patients, and caregivers, urged Congress to reduce the high burden of costly prescription drugs for seniors enrolled in Medicare Part D.

The organizations urged key Chairmen and Ranking Members to implement their recommendations during the reconciliation process. The recommendations include creating an annual out-of-pocket limit of $2,400 of lower for Part D, spreading the out-of-pocket cost across the plan year, and determining if a maximum copay would benefit patients with conditions other than diabetes. To read the full letter, click here.

Researchers from the RAND Corporation estimated the savings from that would be generated by implementing an international reference pricing framework in a JAMA research letter.

Previous studies have evaluated potential savings from list prices, but this study claims there is insufficient studies evaluating the difference in prices between international prices and net prices. The researchers found that linking U.S. prescription drug prices to those in other comparable nations could cut costs of the top 50 brand name drugs in half. Setting US prices to international prices would have lowered US spending by 52.3%, lowering net prices from $159.9 billion to $76.3 billion. To read the full study, click here.

CIDSA Experts in the News

Rachel Sachs summarized the key policy proposals outlined in the administration’s drug pricing plan in a Health Affairs blog post. Sachs breaks down the three principles that guided the HHS plan. Although the plan does not specify policy details that must be passed, it does list priorities for Congress to pass and administrative actions that must be taken to lower drug costs for patients. Sachs calls attention to Trump’s drug blueprint from 2018, noting that if there is no Congressional support with these measures, it will fall on the administration to pass impactful policies. To read the full article, click here.

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