Welcome to the Week in Review.
Medicare Negotiation Promises Big Savings
Medicare’s first-ever lower negotiated drug prices will deliver substantial savings for patients and taxpayers when the lower costs take effect in 2026. Lower negotiated prices for just three of the first 10 drugs selected — Enbrel, Stelara, and Eliquis — will account for more than half of the $6 billion in taxpayer savings projected for the first year, according to the Brookings Institution. In a Centers for Medicare and Medicaid (CMS) press release, CMS illustrated a hypothetical example of a patient benefitting from Medicare negotiation: “a senior with Medicare who takes Stelara pays a 25% coinsurance on the drug which may amount to about $3,400 today for a 30-day supply. When the negotiated price goes into effect in 2026, that same 25% coinsurance would cost the beneficiary about $1,100 before the person reaches the catastrophic cap, after which the beneficiary will pay no more out of pocket on their prescription drugs. A beneficiary’s actual costs will depend on their plan’s benefit design.” The lower negotiated prices will offer more breathing room to the millions of patients on Medicare who pay three to eight times what residents in comparable countries pay for these same medications. The implementation of Medicare negotiation marks a pivotal shift in U.S. drug price policy, promising significant relief while maintaining critical innovation that patients need. P4AD will continue advocating to expand these efforts to ensure lower drug prices for all Americans. — (Brookings Institution, Centers For Medicare and Medicaid Services, Commonwealth Fund)
Keeping Our Foot On The Gas
Big Pharma’s monopoly pricing power stems in part from systematic abuses of our patent and regulatory systems, which they manipulate to maintain high prices and delay lower-cost competition from entering the market. Drug manufacturers employed tactics such as pay-for-delay agreements, patent thickets, and product hopping to extend their exclusivity periods on the first 10 negotiated drugs for years. A report from Accountable.US highlighted the blood thinner medication Xarelto as a “prime example” of abusing patent thickets to extend exclusivity periods. Johnson & Johnson, the drug’s manufacturer, filed 49 patents on Xarelto, resulting in over a decade of added market exclusivity and price hikes. Amgen, the manufacturer of the autoimmune disease drug Enbrel, has filed 57 patent applications since the drug came to market in 1990, with 72 percent of applications coming after initial approval by the Food and Drug Administration (FDA). These practices underscore the urgent need for legislative action to increase competition and lower drug prices for patients. Currently, there are bipartisan bills in Congress, which have already passed out of Senate committees and which aim to curb pharma’s abuses of the system. These bills are projected to save taxpayers $5 billion over ten years. Earlier this month, the Senate unanimously passed S. 150, the Affordable Prescriptions for Patients Act of 2023, which would address patent thicketing in the biologic market. As Congress returns from recess in September, we urge members in the House to take swift action to build off this momentum and finish the job. We will continue to push for further Senate action to pass the additional bipartisan bills which will enable competition and market forces to lower prices for millions of patients. — (Accountable.US, P4AD, patientspushforcompetition.org)
Subscribe to the WEEK IN REVIEW here.