Radar on Drug Benefits

Drugmakers Already Offer Big Rebates for Some Meds Likely to Face Medicare Negotiation

  • Aug 24

    Aug 24, 2023

    More than half of the drugs that could be subject to Medicare price negotiations in 2026 already have net prices that are lower than the minimum discounted price established by the Inflation Reduction Act (IRA), according to an analysis published this month in the Journal of Managed Care + Specialty Pharmacy. The findings come as multiple pharmaceutical manufacturers file lawsuits challenging the IRA and as CMS is set to announce by Sept. 1 the 10 drugs that Medicare will negotiate prices for starting in 2026.

    The IRA stipulates that until 2030 the negotiated price will be capped at the greater of the net price after rebates or a maximum percentage of the drug’s list price based on how long it has been on the market. Specifically, that maximum will be 75% of the average manufacturer price (or a minimum 25% discount) for drugs that have been marketed between nine and 16 years and 40% of the average manufacturer price (or a minimum 60% discount) for drugs that have been on the market for more than 16 years.

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    • Tim Casey

    Tim has been a reporter and editor for newspapers, websites and magazines for more than 20 years, including 10 years covering health care business topics. He has a deep knowledge of the managed care industry and pharmacy benefit management. He also has experience covering medical conferences and clinical and legislative health care issues. In 2014, the Society for Advancing Business Editing and Writing selected Tim as one of 15 journalists to participate in a national symposium on the Affordable Care Act. Tim has a B.A. in Psychology from the University of Notre Dame and an M.B.A. from Georgetown University.

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Managing Editor, Radar on Specialty Pharmacy and Spotlight on Market Access

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Managing Editor, Health Plan Weekly and Radar on Drug Benefits

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Reporter, Radar on Medicare Advantage and Spotlight on Market Access

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Reporter, Health Plan Weekly and Radar on Drug Benefits

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Medicare Part D
Drug Pricing
Drug Rebates
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