President Biden this morning called on Congress to let Medicare negotiate drug prices and penalize drug companies that raise their prices faster than inflation.
Biden said lawmakers should establish a firm cap on the amount that Medicare beneficiaries have to pay out-of-pocket for drugs each year. He said the federal government will work with states and tribes to import safe, lower-cost prescription drugs from Canada, and it will accelerate the development and uptake of generic and biosimilar drugs.
Biden was scheduled to deliver his remarks on action to lower prescription drug prices at the White House at 11:15 a.m. His press office released a fact sheet in advance of his speech early this morning. The fact sheet does not mention the 340B program.
Under the president’s drug price negotiation proposal, Medicare would negotiate the price for a subset of expensive drugs that don’t face competition in the market. The fact sheet says Medicare negotiators would be provided a framework for what constitutes a fair price for each drug, and there should be powerful incentives to make sure drug companies agree to a reasonable price. It says if Medicare makes the prices it negotiates available to commercial payers, too, costs for employer health insurance would fall—reducing premiums by tens of billions of dollars or more.
340B Friendly Think Tank Backs Medicare Negotiation
Nonprofit think tank West Health released a white paper this morning that it says “debunks the myth” that pharmaceutical innovation would suffer if Medicare was empowered to negotiate drug prices. West Health Chief Strategy Officer Timothy Lash was a former senior marketing director at Johnson & Johnson.
West Health’s Sean Dickson has conducted a number of studies on the 340B program that have disputed the pharmaceutical industry’s claims of massive growth in the program and have touted the importance of the inflation penalty in the 340B and Medicaid drug rebate programs.
The president’s plan to lower prescription drug prices comes a day after the U.S. Senate passed a budget bill setting the stage for a vote, perhaps as soon as next month, on a host of Democratic domestic priorities, including lowering drug prices.