Industry watchers said the Biden administration’s decision to negotiate prices for 10 drugs included in Medicare plans marks a strong move by governments around the world to rein in health care costs.
“Today, for the first time, Medicare has selected 10 drugs for negotiation. Seniors will pay $3.4 billion in out-of-pocket costs for these drugs in 2022,” the administration said Tuesday.
Sentiment has shifted around the world, with governments trying to address rising healthcare costs and companies looking to ESG (environmental, social and governance) functions to maintain their sustainability quotient, according to a pharmaceutical industry veteran. . named. He added that the drugs on the list for negotiations are all top innovations, and if the negotiations do reduce costs for seniors, that opens the door for more follow-up drugs.
Analysts say the development may not affect generic drug makers yet because these are innovative drugs. But they added that the concept of “differential pricing” could be sacrificed.
The pharma veteran said the talks could reduce the flexibility of innovative pharmaceutical companies to offer medicines at reduced prices in other markets. After the US, Europe and China are highly sought after markets, but they are also facing pricing pressure. India may therefore see the benefits of differential pricing in India come under pressure, the expert said. (Differential pricing involves innovators pricing their drugs in certain markets at a fraction of the cost of the U.S. or other developed markets.)
Common and Expensive Prescriptions
In a statement, U.S. President Joe Biden said the published list of negotiations were “common and expensive prescriptions” for heart failure, blood clots, diabetes, arthritis, Crohn’s disease and more. That doesn’t include reducing the cost of insulin to $35 a month for seniors enrolling in Medicare, he noted.
These include Jardiance (diabetes and heart failure); Eliquis (thrombosis); Xarelto (thrombosis and heart problems); Januvia (diabetes); Farxiga (diabetes/heart failure/chronic kidney disease); Entresto (heart failure); Enbrel (rheumatoid Arthritis/psoriasis); Novolog/flexpen/pefill (diabetes); Imbruvica (blood cancer); Stelara (Crohn’s/psoriasis).
Negotiations on Medicare drug prices will reduce out-of-pocket costs for the elderly, the statement said, with negotiations for the first batch of selected drugs to begin in 2023 and negotiated prices to take effect in 2026.
short term gain
Big Pharma countered that the move was “a hasty process focused on short-term political gain rather than what’s best for patients”.
Stephen J Ubl, President and CEO of the Pharmaceutical Research and Manufacturers of America (PhRMA), said: “Due to strong private market negotiations, many drugs selected for pricing have received significant rebates and discounts…” The power to set drug prices with little accountability, oversight or input from patients and their doctors will have serious negative consequences long after this government is gone. “
Furthermore, they add, “Politics should not dictate which treatments and cures are worth developing and who should get them. Cancer moonshots will not succeed if this administration continues to dismantle the innovative rockets we need to get there.” This harm will spread beyond cancer and affect people with rare diseases, mental health disorders, and other dire conditions.”