Senators question how HHS plans to roll out new drug pricing reforms
While CMS drug price negotiations won’t actually kick off until 2026, a group of more than two dozen Republican senators is already raising questions about how this new law will be implemented.
The partisan law (all Democrats in the House and Senate voted for it, and all Republicans voted against it) includes not only Medicare price negotiations but mandatory inflation-related rebates that will begin next year, as well as million-dollar fines for noncompliance.
In a letter sent earlier this week to both HHS Secretary Xavier Becerra and CMS administrator Chiquita Brooks-LaSure, the group of 25 Republican senators expressed “concerns with the disruptive and distortive administrative undertaking that the implementation of this far-reaching federal expansion will inevitably represent.”
They also note both the CBO’s point that the negotiations could increase launch prices for new drugs, and reduce the number of new drug approvals in the coming years.
The law’s true impact on biopharma R&D may be difficult to track, given the fact that there are usually multiple reasons a drug’s development might be discontinued. The CBO has said that over the next 30 years, of the approximately 1,300 drugs approved, about 15 drugs may be cut from biopharma companies’ collective pipelines, including two over the 2023-2032 period, about five over the subsequent decade, and about eight over the third decade.
“Other independent analyses have projected even more catastrophic consequences, from hundreds of thousands of domestic job losses to hundreds of billions in forgone R&D dollars,” the Republicans wrote.
Companies like Eli Lilly, Novo Nordisk and AstraZeneca may be disproportionately affected by the law.
The Republicans, which included Utah’s Mitt Romney, North Carolina’s Thom Tillis, and West Virginia’s Shelley Moore Capito, also note that the law’s implementation doesn’t use the standard notice-and-comment rulemaking process typically required for such “substantive regulatory policymaking.” This “exclusion of patient voices from policymaking poses potentially catastrophic consequences, particularly for individuals living with rare diseases or with disabilities,” they wrote, requesting details on how those voices will be heard.
The group also seeks info on plans to “enforce the legislation’s ban on the use of discriminatory comparative effectiveness research” and questions on “the lack of a floor for Secretary-dictated prices.”
And the final question from the group is on how the administration plans to monitor these wide-ranging effects of the new program, on everything from patient access to R&D investments, launch prices, new drug approvals and domestic manufacturing jobs.