Welcome to the Week in Review.
The Inflation Reduction Act Turns Two
The Inflation Reduction Act’s second anniversary marks a major milestone in the drug pricing landscape. For decades, skyrocketing drug prices have forced patients on Medicare to choose between medication and other necessities. Now, thanks to the Inflation Reduction Act, patients on Medicare are beginning to breathe easier. The $35 insulin copay cap, which went into effect in 2023, isn’t just a number – it represents peace of mind for patients like Steven Hadfield and Bob Parant, who have seen their monthly costs plummet from hundreds to just $35. Free recommended vaccines and the cap on out-of-pocket costs at around $3,500 annually are also delivering substantial relief to seniors like Judy Aiken and Ginny Boynton, who both have faced thousands of dollars in annual out-of-pocket costs for their medicines. And even more change is now on the horizon as the $2,000 annual cap on out-of-pocket costs is due to take effect in 2025 and the lower prices for the first ten negotiated drugs will come into effect in 2026. The announcement of the maximum fair prices for the first 10 drugs selected for price negotiation is due in the coming days and will potentially save nearly nine million people as much as thousands of dollars per month on just one prescription alone. These drugs — including cancer treatments, blood thinners, autoimmune disease treatments, and some diabetes drugs — accounted for $3.4 billion in out-of-pocket costs for patients on Medicare in 2022. The Inflation Reduction Act is a monumental step toward a future where every American can get the prescription drugs they need at prices they can afford and an important milestone to celebrate and to build on. — (USC, AARP, CAP, The White House
Court Watch: US v. Pharma
On Thursday, a federal judge in Ohio dismissed a legal challenge brought by the national U.S. Chamber of Commerce and a few regional Chambers of Commerce to stop successful implementation of Medicare negotiations. Judge Michael J. Newman stated that the case was thrown out because the lawsuit was filed in an improper venue, slamming the Chamber for “venue shopping” for a potentially friendly court, and found that other plaintiffs in the case lacked standing. This dismissal marked the seventh consecutive loss for the pharmaceutical industry and its allies who filed lawsuits in various district courts as part of an “industry wide strategy” to escalate these cases to the Supreme Court. P4AD’s David Mitchell, who takes Eliquis, one of the first 10 drugs selected for negotiation, set the record straight: “It’s US vs. Pharma and we are winning because the drug companies’ claims thus far have been found to lack merit on both substance and procedure. As they appeal, we will continue to fight.” — (Bloomberg Law, Politico, STAT, Reuters, P4AD)
Big Pharma Patent Gaming
Patients in the U.S. face exorbitant prices for blockbuster diabetes and weight loss drugs — like Ozempic, Wegovy, and Mounjaro — meanwhile residents in comparable nations see list prices that are significantly lower for these same medications. The reason? Barriers to both drug price negotiation and generic competition. While most high-income countries have a variety of mechanisms to negotiate lower drug costs, residents in the U.S. face substantially higher list prices in large part because pharmaceutical corporations have rigged the system in their favor. Drugmakers exploit our patent system as part of their business model to extend monopoly periods including on GLP-1 treatments. By filing frivolous patents, including on the delivery mechanisms used to inject these drugs, they can help delay generic competition. These anti-competitive tactics, employed by drugmakers including Eli Lilly and Novo Nordisk, mirror the patent strategy used by the very same companies to extend monopoly periods on blockbuster insulin drugs. “Just thinking about how long those companies have kept patent protection for insulin, I would imagine they have pretty substantial legal effort going into preventing generic entry for those drugs,” Professor Stacie Dusetzina told Axios when discussing the lack of competition for this emerging class of drugs. As long as these shady practices that block competition are permitted by law, patients will continue to be forced to pay some of the highest drug prices in the world for brand-name drugs. — (KFF, Inside Health Policy, STAT, Axios)