Hiring and data: how the U.S. will set up new Medicare drug price talks

WASHINGTON (Reuters) – The U.S. government will soon hire experts to collect the data it needs to begin direct negotiations over the price of prescription drugs for the elderly and disabled, a senior Biden administration official said. told Reuters.

President Joe Biden last week signed into law the Inflation Reduction Act, which introduces new policies to address climate change, taxes and rising drug prices.read more

The law marks the first time that the Federal Medicare Health Insurance Program for people 65 and older and those with disabilities will be allowed to negotiate prices for up to 20 drugs per year. It also places limits on Medicare drug price increases and caps the out-of-pocket costs for those enrolled in the program.

The move represents a rare legislative defeat for a powerful pharmaceutical industry and sets a precedent for keeping drug prices in check in the world’s most lucrative drug market.read more

“We’re definitely looking to increase our expertise,” Chiquita Brooks Rashua, administrator of the Centers for Medicare and Medicaid Services, said in an interview. it took time.”

Brooks-LaSure said it will create a new team tasked with negotiating drug prices within Medicare centers. Starting this fall, he plans to begin hiring more than 100 people, according to CMS.

Brooks-LaSure said: Including his 64 million people enrolled in Medicare.

“One of the first things we’ll do is pick a drug to negotiate. We have 10 now, and that’s going to be announced next fall, so about a year from now,” she said. .

CMS will need to collect data from drug manufacturers, health insurers and pharmacy benefit managers (PBMs) to identify the first 10 drugs to negotiate, with the list growing to 20 by 2029. She said it would increase to

Data collection

The government chooses from 50 “high-spending” drugs with only one supplier, based on Medicare utilization and costs. Health care analysts said they were interested in Bristol-Myers Squibb’s (BMY.N) anti-cancer drug Revlimid, AbbVie’s (ABBV.N) rheumatoid arthritis treatment Humira, and an anti-cancer drug marketed by Johnson & Johnson (ABBV.N). Blood coagulant Xarelto (JNJ.N) in the US.

However, the U.S. market often hides complete information about drug prices. Pharmaceutical companies, which have gone to great lengths to block the passage of new legislation, say they often offer sizable rebates and discounts on health insurance plans that aren’t passed on to consumers. Health insurance claims drug companies are responsible for setting and increasing the price of drugs.

The Pharmaceutical Research and Manufacturers Association of America (PhRMA), a powerful trade body in the pharmaceutical industry, comments on how members may provide information to CMS or whether any members have been contacted refused to do so.

Officials representing the three largest PBMs helping health plans negotiate prices did not respond to requests for comment.

The AHIP, the health insurance industry’s largest trade association, and its members are “ready to assist” the government “on this or any other issue related to the implementation of new policies,” spokesperson David Allen said. Stated.

high speed movement

Health policy experts say CMS does not currently have the ability to negotiate drug prices, so it will have to hire outsiders. The law mandates that negotiations begin in 2023 and the new price takes effect in his 2026, so agencies will need to act quickly to make an impact.

“The idea of ​​negotiating drug prices has been debated for quite some time, but this law came together very quickly, so the federal government needs to act quickly to put the infrastructure here. Yes,” said Vice President Larry Levitt. President of Health Policy at the Kaiser Family Foundation.

Brooks-LaSure said it intends to have a broad net and is considering hiring experienced public and private negotiators and drug pricing experts.

“We’re definitely looking for recruits from our friends in government and people outside, and people will start seeing posts on our CMS website,” she said. Whether it’s in the VA, the outside world, or the commercial market, we welcome it.”

The Department of Veterans Affairs (VA), which covers health care for more than 9 million people, is negotiating drug prices, but on a much smaller scale than Medicare hopes.

Brooks-LaSure acknowledged the difference, saying “there will be some new approaches unique to CMS” to the negotiations.

CMS, an influential Boston-based nonprofit, should also look to groups such as the Institute for Clinical and Economic Review (ICER), which studies drug prices, said President Barack Obama. Andy Slavitt, former head of CMS, said below.

“These are challenging bargains where people are being forced to eat dog food they don’t want to eat,” Slavitt said.

Reporting by Ahmed Aboulenein, Washington Editing by Michele Gershberg and Matthew Lewis

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