U.S. Rep. Katie Porter's (D-Calif.) Freedom from Price Gouging Act would require drug manufacturers to pay a Medicare Part B rebate for certain drugs if the price of such drugs increases faster than inflation.

Rep. Porter Files Bill to Require Medicare Part B inflation-Based Rebates

U.S. Rep. Katie Porter (D-Calif.), a California Democrat with a significant national profile, yesterday introduced legislation to require drug manufacturers to pay a Medicare Part B rebate for certain drugs if the price of such drugs increases faster than inflation.

Porter’s Freedom from Price Gouging Act (H.R. 2706) would apply to single-source drugs and biologicals that cost $100 or more and are paid for under Medicare fee for service. The bill raises the possibility of extending the rebate to multiple-source drugs and drugs paid for under Medicare Advantage plans, after the U.S. Health and Human Services Department (HHS) conducts a feasibility study.

H.R. 3, the bill to lower drug prices favored by Speaker Nancy Pelosi (D-Calif.) and Energy and Commerce Chair Frank Pallone (D-N.J.) also includes a version of the Medicare rebate proposal. That bill, however, also would require HHS to negotiate maximum prices on Medicare’s behalf for single-source drugs that account for the greatest Medicare spending. The negotiated prices would have to be offered under Medicare and could also be offered under private health insurance unless the insurer opts out, according to a description of the bill on the Congress.gov website.

Porter’s bill was referred to both the Energy and Commerce and Ways and Means committees.

Porter has become somewhat of a national celebrity as result of her viral videos grilling corporate executives. Her questioning of former Celgene CEO Mark Alles regarding the price of Revlimid has received close to 23 million views on Twitter. The exchange is featured in Part 5 of 340B Report’s recent investigative series on Celgene’s 340B pricing practices.