Biden Administration, CMS Reveal First 10 Drugs Set for Price Negotiation

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On August 29, 2023, the Biden Administration debuted the list of the first 10 drugs identified for price negotiation under the Inflation Reduction Act. The list, which includes agents indicated for diabetes, heart failure, GI conditions, and arthritis, accounted for more than $50 billion in spending during the evaluation period.

Xavier Becerra | Credit: US Department of Health and Human Services

Xavier Becerra
Credit: US Department of Health and Human Services

The Biden-Harris Administration, along with the US Department of Health and Human Services (HHS) and Centers for Medicare and Medicaid Services, has announced the first drugs selected for Medicare Price negotiation, with the list containing commonly used agents for a slew of chronic conditions, including diabetes, arthritis, heart failure, and more.

Announced on August 29, 2023, the list of 10, which includes a pair of popular blood thinners, multiple antidiabetic agents, fast-acting insulin, etanercept, ustekinumab, and ibrutinib, accounted for more $3.4 billion in out-of-pocket costs for Medicare beneficiaries in 2022.

“For far too long, pharmaceutical companies have made record profits while American families were saddled with record prices and unable to afford life-saving prescription drugs. But thanks to the landmark Inflation Reduction Act, we are closer to reaching President Biden’s goal of increasing availability and lowering prescription drug costs for all Americans,” said HHS Secretary Xavier Becerra.1

The announcement and intention to negotiate pricing for the aforementioned agents is part of the Inflation Reduction Act, which was signed by President Joe Biden in August 2022. According to the release from the HHS, the drugs included in the list accounted for $50.5 billion in total Part D gross covered prescription drug costs, which is about 20% of the entire Part D gross covered prescription drug costs between June 1, 2022 and May 31, 2023.1

The specific agents included in the first set selected for price negotiation are listed below in order of total spent on each during the evaluation period:2

  • Apixaban (Eliquis): Indicate for prevention and treatment of blood clots.
  • Empagliflozin (Jardiance): Indicated for type 2 diabetes and heart failure.
  • Rivaroxaban (Xarelto): Indicated for prevention and treatment of blood clots; Reducing risk for patients with CAD/PAD.
  • Sitagliptin (Januvia): Indicated for type 2 diabetes.
  • Dapagliflozin (Farxiga): Indicated for type 2 diabetes, heart failure, and chronic kidney disease.
  • Sacubitril/valsartan (Entresto): Indicated for heart failure.
  • Etanercept (Enbrel): Indicated for rheumatoid arthritis, psoriasis, and psoriatic arthritis.
  • Ibrutinib (Imbruvica): Indicated for blood cancers.
  • Ustekinumab (Stelara): Indicated for psoriasis, psoriatic arthritis, Crohns disease, and ulcerative colitis.
  • Insulin aspart (Fiasp; Fiasp FlexTouch; Fiasp PenFill; NovoLog; NovoLog FlexPen; NovoLog PenFill): Indicated for use in diabetes mellitus.

“Although drug companies are attempting to block Medicare from being able to negotiate for better drug prices, we will not be deterred. The Biden-Harris Administration will continue working to ensure that Americans with Medicare have access to innovative, life-saving treatments at lower costs,” Becerra added.1

The release from the HHS also pointed out the Centers for Medicare and Medicaid Services (CMS) will publish any agreed-upon negotiated prices for the selected drugs by September 1, 2024, and those prices will come into effect starting January 1, 2026. In 2027, CMS will select for negotiation up to 15 more drugs covered under Part D. In 2028, CMS will select up to 15 additional drugs, including drugs covered under Part B and Part D, for negotiation and up to 20 more drugs for each year after that, as outlined in the Inflation Reduction Act.1

In a request for comment, HCPLive advisory board member Diana Isaacs, PharmD, expressed optimism over the potential implications of the list based on the agents included, but also noted the long-term impact of this novel approach will need to be monitored.

"I think it makes sense to focus on the higher cost drugs. This will most likely reduce medicare spending, which ultimately saves taxpayers money. It will be great to see more transparency with drug pricing. With the upper cap on the price, this should save patients money and make US prices more comparable to other countries," noted Isaacs, who serves as an endocrine clinical pharmacist, director of Education and Training in Diabetes Technology, and codirector of Endocrine Disorders in Pregnancy at the Cleveland Clinic. "Although, the implications on future research and drug approvals are unknown. Therefore, I am glad they are only doing 10 drugs at a time so we can see these potential impacts."

References:

  1. Assistant Secretary for Public Affairs (ASPA). HHS selects the first drugs for Medicare Drug Price Negotiation. HHS.gov. August 29, 2023. Accessed August 29, 2023. https://www.hhs.gov/about/news/2023/08/29/hhs-selects-the-first-drugs-for-medicare-drug-price-negotiation.html.
  2. Centers for Medicare and Medicaid Services. Medicare Drug Price Negotiation Program: Selected Drugs for Initial Price Applicability Year 2026. August 29, 2023. Accessed August 29, 2023. https://www.cms.gov/files/document/fact-sheet-medicare-selected-drug-negotiation-list-ipay-2026.pdf.
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