President Biden is sending proposed prices Thursday to the makers of 10 prescription drugs singled out for cost negotiations under Medicare, the next step in a historic program that is a key accomplishment for his reelection campaign.
Mr. Biden’s team and the drug companies will discuss the initial offer before negotiations end in August. The “maximum fair price” for drugs will be announced shortly before the election this fall and take effect in 2026.
“Medicare is no longer taking whatever prices for these drugs that the pharmaceutical companies demand,” the president said.
Mr. Biden and his allies say allowing Medicare to negotiate down the price of drugs is a commonsense way to put patients over profits. Democrats sought the program for years and got it across the finish line in Mr. Biden’s 2022 tax and climate bill.
Yet the pharmaceutical industry says the program amounts to extortion, not negotiation.
Drugmakers and the U.S. Chamber of Commerce have sued over the program, claiming companies have no choice but to accept the price the government demands or else pull out of the sprawling Medicare program for seniors. They hope the courts will stop the program before it goes into effect.
“This continues to be an exercise to win political points on the campaign trail rather than do what’s in the best interest of patients. Government bureaucrats are operating behind closed doors to set medicine prices without disclosing for months how they arrived at the price or how much patient and provider input was used,” said Alex Schriver, senior vice president of the Pharmaceutical Research and Manufacturers of America.
Mr. Biden isn’t shying away from the fight as he positions himself as a champion for lower health costs ahead of a potential election rematch with former President Donald Trump.
“To keep their prices high, Big Pharma and their allies lobbied hard against this historic law, and they were joined by every single Republican in Congress, who voted against giving Medicare the power to negotiate lower prices,” Mr. Biden said Thursday, adding that congressional Republicans want to repeal the program.
A KFF poll taken in 2021 found that allowing Medicare to negotiate down prices is exceedingly popular, with 83% favoring it.
The bad news for Mr. Biden is that many people don’t realize it is happening, with more than two-thirds of people unaware or unsure if negotiation is happening compared to 32% who were aware of the program in a KFF survey taken in the fall.
The drugs selected for the first round of price negotiations combat conditions such as diabetes, Crohn’s disease, arthritis, heart disease and cancer.
Additional drugs from Medicare Part D and the doctor-administered Part B program will be selected in subsequent years.
The Congressional Budget Office estimates the drug-negotiation program will save taxpayers $100 billion through 2031 while modestly curtailing the share of new drugs coming to market by around 1%.
Promoters of the program say it will reduce seniors’ out-of-pocket costs and could spill over into negotiations between employer plans and drugmakers, though it is unclear if that will happen.
The drugs selected in the first round were Eliquis by Bristol Myers Squibb, Jardiance by Boehringer Ingelheim, Xarelto by Janssen Pharmaceuticals, Januvia by Merck, Farxiga by AstraZeneca, Entresto by Novartis, Enbrel by Immunex Corp., Imbruvica by Pharmacyclics LLC, Stelara by Janssen Biotech and a series of insulins made by Novo Nordisk — Fiasp, Fiasp FlexTouch, Fiasp Penfill, NovoLog, NovoLog FlexPen and NovoLog Penfill.
• Tom Howell Jr. can be reached at thowell@washingtontimes.com.
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