The proposed drug pricing legislations follow the Inflation Reduction Act, passed in August 2022.
Pictured: U.S. Capitol/Courtesy Andrea Izzotti/Adobe Stock
Tuesday, U.S. Sens. Bernie Sanders (I-VT) and Bill Cassidy (R-LA) announced plans to hold an official markup session to discuss proposed legislation for lowering drug prices. The hearing is scheduled for May 2.
Sanders is the chairman of the Senate’s Health, Education, Labor and Pensions (HELP) Committee, while Cassidy is a ranking member. The HELP Committee will examine four bills, including the RARE Act, the Ensuring Timely Access to Generics Act of 2023, the Expanding Access to Low-Cost Generics Act of 2023 and the Pharmacy Benefit Manager Reform Act.
The HELP Committee announcement came one day after more than 20 Democrats introduced new legislation seeking to lower prescription drug prices for patients by empowering Medicare.
The bill, dubbed the Strengthening Medicare and Reducing Taxpayer (SMART) Prices Act, is being sponsored by Sen. Amy Klobuchar (D-MN) and Peter Welch (D-VT), with support from other Democrat colleagues such as Tammy Baldwin (D-WI), Richard Blumenthal (D-CT) and Cory Booker (D-NJ).
“By strengthening Medicare’s ability to negotiate drug prices, our legislation will lower prescription costs on even more drugs and save taxpayers money,” Klobuchar said in a statement.
The SMART Prices Act builds upon the Inflation Reduction Act (IRA), which was signed into law in August 2022. Under the IRA, the federal government can negotiate with pharmaceutical companies for a maximum fair price for specific high-spend medicines after a certain amount of time has passed.
Prices of small-molecule drugs can be negotiated nine years after FDA approval, while biologics are afforded four more years, with protection from negotiations lasting for 13 years. The Act’s provisions for negotiations will take effect starting in 2026.
The IRA will also require drugmakers to pay rebates to Medicare if price hikes outpace inflation.
Klobuchar’s SMART Prices Act seeks to shorten the window of protection for both biologics and small-molecule drugs, allowing Medicare to kick off drug price negotiations five years after being approved by the FDA. If signed into law, the SMART Prices Act would also enable Medicare to negotiate prices for more drugs overall.
Biopharma Bristles at Drug Pricing Legislation
In August, soon after the U.S. Senate passed the IRA, Stephen Ubl, CEO of Pharmaceutical Research and Manufacturers of America, called the decision a “tragic loss for patients,” saying that the government’s control over drug prices would discourage companies and research groups to innovate, leading to fewer new cures and treatments.
Just prior to the IRA’s passing, Merck CEO Robert Davis said the IRA would be “highly chilling on future innovation.”
Aside from the IRA, the U.S. government has taken other steps recently to put a cap on drug prices. In March, Sanders wrote to Sanofi and Novo Nordisk, urging them to follow Eli Lilly’s lead and lower insulin prices. Both ultimately did follow suit, with Novo vowing to cut some insulin prices by 75% beginning in 2024 and Sanofi slashing the price of Lantus by 78% beginning on Jan. 1, 2024.
Tristan Manalac is an independent science writer based in metro Manila, Philippines. He can be reached at tristan@tristanmanalac.com or tristan.manalac@biospace.com
