Tag Archives for U.S. Chamber of Commerce

Medicare to negotiate select drug prices with Big Pharma, lists first 10 drugs

Published in RINewsToday on September 4, 2023

While critics are attempting to go through the courts to put the brakes on allowing Medicare to negotiate and set drug prices, last week, the Biden administration announced its list of 10 drugs that will be subject to price negotiations mandated by the Inflation Reduction Act (IRA).  

Earlier this month, more than 70 groups and a petition signed by 150,000 individuals called on Merck & Co., Bristol Myers Squibb Company, Janssen Pharmaceuticals, Astellas Pharma US, Pharmaceutical Research and Manufacturers of America (PhRMA) and the U.S. Chamber of Commerce, to drop their lawsuits to block the drug price negotiation provisions from taking place, and several organizations filed an amicus brief in support of the Biden administration’s historic law. 

With President Biden signing the IRA into law in Aug. 2022, the Centers for Medicare and Medicaid Services (CMS) began hammering out the regulations by issuing on March 15, 2023 its initial guidance for its Medicare Drug Price Negotiation Program. At that time, CMS had received over 7,500 comments on its initial guidance from consumer and patient groups, drug companies and pharmacies.  On June 30, 2023, the federal agency released its revised guidance detailing the requirements and parameters for the program. With the publishing of the listing of 10 drugs on August 29, 2023, for the first time, Medicare is now able to move forward in negotiating prices directly with drug companies, with the goal of lowering prices on some of the costliest prescription drugs. 

According to CMS, the selected 10 drugs accounted for $50.5 billion in total Part D gross covered prescription drug costs, or about 20%, of total Part D gross covered prescription drug costs between June 1, 2022, and May 31, 2023, which is the time period used to determine which drugs were eligible for negotiation. The negotiations with participating drug companies begin now until 2024, and any negotiated prices will become effective beginning in 2026. Medicare beneficiaries taking the 10 drugs covered under Part D selected for negotiation paid a total of $3.4 billion in out-of-pocket costs in 2022 for these drugs.

It’s a Long Wait…Lower Prices to Take Effect Jan. 2026

CMS will publish any agreed-upon negotiated prices for the selected drugs by September 1, 2024; those prices will come into effect starting January 1, 2026. In future years, CMS will select for negotiation up to 15 more drugs covered under Part D for 2027, up to 15 more drugs for 2028 (including drugs covered under Part B and Part D), and up to 20 more drugs for each year after that, as outlined in the IRA.  CMS will provide opportunities for public comment at patient-focused listening sessions in Fall 2023.

“For far too long, pharmaceutical companies have made record profits while American families were saddled with record prices and unable to afford life-saving prescription drugs,” says Secretary Xavier Becerra, of the U.S. Department of Health and Human Services (HHS). “Although drug companies are attempting to block Medicare from being able to negotiate for better drug prices, we will not be deterred,” she pledges. 

With the announcement of the first drugs selected for Medicare drug price negotiation, CMS Administrator Chiquita Brooks-LaSure noted it marked a significant and historic moment for the Medicare program. ”Our goal with these negotiations is to improve access to some of the costliest drugs for millions of people with Medicare while driving competition and innovation,” she said.

Adds Meena Seshamani, MD, PhD, CMS’s Deputy Administrator and Director of the Center for Medicare, “Promoting transparency and engagement continue to be at the core of how we are implementing the new drug law and the Medicare Drug Price Negotiation Program, and that is why we set out a process for the first round of negotiation that engages the public throughout.” 

“No one should have to choose between paying for lifesaving medication and other basic necessities, like food and housing,” says Rep. Seth Magaziner, representing Rhode Island’s Congressional District 2.  Nearly 191,000 Rhode Islanders are enrolled in Medicare Part D and could be eligible for cost savings that results from CMS’s negotiating with drug makers, he says, noting that.  Rhode Island seniors paid an average of $6,022 in out-of-pocket costs per year for one of the drugs selected for Medicare Price Negotiations.  These drugs are used to treat some of the most common diseases like diabetes, heart disease, arthritis, blood clots, and cancers.   

But PhRMA and U.S. Chamber of Commerce express strong concerns over imposing government price controls on the price of medications.  

CMS’s release of 10 drugs selected for negotiation “is the result of a rushed process focused on short-term political gain rather than what is best for patients,” says PhRMA) President and CEO Stephen J. Ubl. “Many of the medicines selected for price setting already have significant rebates and discounts due to the robust private market negotiation that occurs in the Part D program today,” he claims.

“Giving a single government agency the power to arbitrarily set the price of medicines with little accountability, oversight or input from patients and their doctors will have significant negative consequences long after this administration is gone,” warns Ubl.

Furthermore, “insurance companies and their Pharmacy Benefit Managers may further restrict access to medicines through increased utilization management, higher copays and more restrictive formularies, notes Ubl.

USCoC also expresses strong concerns over HHS’s move to impose government price controls on medications. While USCoC is supportive of affordable medications, it warns that an implementing government price controls scheme is both “counterproductive and will restrict access to critical medicines, delay treatment for patients, and jeopardize the search for new lifesaving cures,” says Executive Vice President and Chief Policy Officer Neil Bradley. 

“In its rush to implement the IRA’s price control scheme, the Biden administration failed to examine the likely negative side effects of the policy, charges Bradley.

Celebrating a Sweet Victory

“The negotiated drugs list is a watershed moment for medicine affordability. Drug corporations pretend this is a catastrophe, but I would rather see that money in seniors’ pockets than Big Pharma’s,”  says Peter Maybarduk, director of the Access to Medicines program at Public Citizen

“Drug corporations, in crude arrogance, are suing to limit price negotiations under the IRA. But the list shows instead how important it is to expand those negotiation powers. Several monopolized drugs that are expensive for Medicare today are exempted from price negotiation, and will remain expensive,” predicts Maybarduk, explaining that for a many-years long grace period after a drug first comes to market. “During those years, drug makers will exploit patent monopolies with minimal checks on profiteering. That profiteering period is even longer for biologics, which comprise some of the most exorbitantly priced drugs,” he says. 

“This is an historic day in the effort to lower prescription drug prices for seniors.  The Biden administration has released the names of the 10 life-saving drugs that will be subject — for the first time ever — to price negotiation between Medicare and Big Pharma,” stated Max Richtman, President and CEO, National Committee to Preserve Social Security and Medicare.

According to Richtman, the Inflation Reduction Act provides for this reform, in addition to a $2,000 out-of-pocket cap for patients’ Medicare Part D drug costs and penalties for drug-makers who hike prices above the rate of inflation. Medicare price negotiation alone is expected to save seniors and taxpayers billions of dollars in drug costs over next the decade.

“This is a sea change in the government’s ability to lower prescription drug prices for older Americans, who all too often are compelled to ration medications or forgo filling prescriptions because of soaring costs. NCPSSM has fought for Medicare to be empowered to negotiate prices for some twenty years now,” adds Richtman., noting that the next step is to enlarge the number and type of medications subject to negotiation, to deliver maximum relief to seniors on fixed incomes.   

“Allowing Medicare to negotiate prices for these first 10 drugs will finally bring much needed access and relief to American families, particularly older adults. We cannot overstate how monumental this law is for older Americans’ financial stability and overall health, said AARP Executive Vice President and Chief Advocacy and Engagement Officer Nancy LeaMond. 

“The big drug companies and their allies continue suing to overturn the Medicare drug price negotiation program to keep up their price gouging. We can’t allow seniors to be Big Pharma’s cash machine anymore. AARP will keep fighting to protect Medicare negotiation from any efforts to undo or weaken it, so all older Americans can afford their lifesaving medicines,” Says LeaMond.

And Alex Lawson, Executive Director of Social Security Works, says CMS’s listing of 10 drugs are among the most outrageously priced drugs on the market, calling these drugs, “Pharma’s prized cash cows.”

“This is just the beginning,” says Lawson, predicting that within a decade, Medicare will have the power to negotiate lower prices on well over 100 drugs. “That’s a huge win for seniors and people with disabilities,” she adds, noting that it is the biggest legislative defeat Big Pharma has ever suffered – and it won’t be the last.

Final Note…

Vincent Marzullo, who serves on the Board of the Senior Agenda Coalition of RI as well as a member of Congressman Magaziner’s Senior Advisory Committee, says that despite CMS’s  announcement of the 10 drugs to be negotiated, consumers won’t realize a penny in savings until January 2026, 28 months from now. “Unfortunately, urgency seems not to be a feature of the Inflation Reduction Act at least when we will get lower priced prescriptions,” he says.

View a fact sheet from the Office of the Assistant Secretary for Planning and Evaluation (ASPE) at: https://aspe.hhs.gov/sites/default/files/documents/705b9c384d493e442a1d4004905cf8ae/ASPE-IRA-Drug-Negotiation-Fact-Sheet.pdf.

More information on the Medicare Drug Price Negotiation Program is available at https://www.cms.gov/inflation-reduction-act-and-medicare/medicare-drug-price-negotiation.

Wake up call on spiraling brand-name drug prices 

Published in RINewsToday on August 14, 2023

By Herb Weiss

A new pharmaceutical drug price report that is both timely and overdue has been released by AARP’s Public Policy Institute, following on the heels of the Centers for Medicare & Medicaid Services (CMS) releasing in June, which revised guidance for the historic Medicare Drug Price Negotiation Program.  

This report details the list prices for the 25 brand-name drugs with the highest total Medicare Part D spending in 2021, noting that prices have increased by an average of 226%—or more than tripled—since they first entered the market. Those 25 drugs were responsible for $80.9 billion in total Medicare Part D spending in 2021, about 37% of the total spending, and were used by more than 10 million Part D enrollees.  It noted that, on average, nearly 60% of their current list price was due to price increases after the product entered the market.

The price of Enbrel, used to treat rheumatoid arthritis and psoriatic arthritis, has increased by 701% since coming to market in 1998, and the price of Januvia, used to treat diabetes, has increased by 275% since entering the market in 2006.

Overall, the lifetime price increases ranged from 20% to 739%, and all but one of the drugs’ lifetime price increases greatly exceeded the annual rate of inflation over the same period of time. 

Brand-name drug prices increase faster than inflation has – for decades

“Brand-name drug prices have increased dramatically faster than inflation for decades,” said Leigh Purvis, Prescription Drug Policy Principal, AARP Public Policy Institute, and author of the report.  “The median price of a new brand-name prescription drug is now approximately $200,000 per year, so even relatively small percentage price increases can translate into thousands of dollars and put life-saving medications out of reach of the patients who need them,” she said. 

“We know that there is lot of media attention on individual drug prices that take place year after year.  However, a lot less attention is paid to how those price increases are often building on top of a long line of price increases and how those relentless price increases add up over time,” says Purvis, during a press call to journalists scheduled on the day of the report’s release.

“These findings have huge implications for the people that AARP represents, many of whom need prescription drugs to help them stay well,” Purvis said. “People on Medicare prescription drug plans take on average of between 4 and 5 prescription drugs per month and their drugs are increasing covered using coinsurance where you pay a percentage of the drugs price instead of a flat co-pay.  In fact, across the country more and more people are facing cost sharing directly affected by drug price increases, whether it is by coinsurance or simply before they meet their deductible.  Millions of other people don’t have health coverage and are having to absorb the cost associated with growing drug prices on their own,” she said.

“Our analysis shows that drugs that have been on the market for twenty years or more have seen an average lifetime price increase of 592 percent.  In real terms this can be the difference of thousands of dollars for one person and enough to force the trade-offs that we often hear about, like choosing to put food on the table or being able to pay for gas,” notes Purvis.

“There is no justification for drug companies to engage in these type of price increases every year they are on the market, particularly increases that are so much higher than the price increases for other goods and services,”  adds Purvis. 

CMS releases revised guidance for negotiating with drug manufacturers 

Congress recently passed the Inflation Reduction Act (IFA), a federal law requiring drug companies to pay a penalty to Medicare if their drug’s price increases faster than the rate of inflation. The law will also give Medicare the ability to negotiate lower drug prices with drug companies for the first time. CMS is expected to announce the first 10 drugs selected for negotiation by September 1st, and the negotiated prices will become available in 2026.

“This historic law cracks down on the big drug companies and [will bring] real relief to millions of seniors who have been struggling with out-of-control prescription drug prices,” said Nancy LeaMond, AARP Executive Vice President and Chief Advocacy and Engagement Officer. “American families simply can’t afford to keep paying the highest prices in the world for the medications they need.”

Last March, CMS issued initial guidance to seek comments on its historic Medicare Drug Negotiation Program.  The agency received over 7,500 comments from consumer, patient groups, drug companies and pharmacies.  In June, CMS released its revised guidelines detailing the requirements and parameters of how the agency will oversee the new program.

“Issuing final guidance for the Medicare Drug Price Negotiation Program is an important “next step” in controlling spiraling high drug prices, says AARP’s LeaMond, noting that Medicare’s new buying power will get a better price for Medicare beneficiaries, saving the program billions of dollars and making prescription drugs more affordable.

Opposition, of course

At press time, the Pharmaceutical Research and Manufacturers of America (PhRMA), the leading industry lobby group for pharmaceutical companies, along with a group of pharmaceutical companies and trade groups, are suing the U.S. Health and Human Services to block the implementation of the Medicare Drug Price Negotiation Program established by the Inflation Reduction Act enacted by President Biden last August. The U.S. Chamber of Commerce has also filed a lawsuit in a U.S. District Court in Ohio to ask for an injunction to keep the negotiations from going forward. The trade group is challenging the constitutionality of the IFA’s drug price negotiation program.   

It’s a very high lift and big burden to meet the standard to stop the law from being implemented,” noted Kelly Bagby, AARP’s Vice President at AARP Foundation Litigation, before AARP’s press call ended.

“It is entirely appropriate and is necessary and the public interest is so enormous in balancing of the government’s interest verses the pharmaceutical companies and Chamber’s interest in this case,” says Bagby,” stressing that beneficiaries have to win this case. “It’s so obvious that pharmaceutical companies are not the victims they are painting themselves to be, she adds, affirming her belief that beneficiaries and Medicare have the strongest argument.  

Bagby noted, “AARP is working to protect the integrity of whole Medicare program for everybody and to allow for older people to not have to make horrible choices about do I pay my rent or do I get to take my life saving drugs.” 

Reports a Wake-Up Call

Although PhRMA,  pharmaceutical companies and trade groups along with the U.S. Chamber are strongly opposed to CMS’s new program to negotiation drug prices, polls show that people aged 50 and over, view the lowering of the price of costly prescription drugs to be a very important policy issue to them. Purvis hopes that the recently released AARP report will serve as a wake-up call for every American who is skeptical about the importance of lowering prescription drug prices. “Higher government spending driven by drug price increases will affect all Americans in the form of higher taxes, cuts to public programs, or both,” she predicts.  

For a copy of AARP’s Medicare Part D Drug Price report, go to https://www.aarp.org/pri/topics/health/prescription-drugs/prices-top-medicare-part-d-drugs-tripled-since-entering-market.html.

Rally round Martin O’Malley for Social Security Administration Commissioner

Published in RINewsToday on August 7, 2023

Just weeks ago, President Joe Biden nominated former Maryland Governor Martin O’Malley, Social Security Commissioner, to lead the Social Security Administration (SSA) in delivering benefits to 67 million Americans per month, totaling over 1 trillion dollars in benefits paid during the year. With the SSA Trust Fund running out of money in 2033 if changes are not made to financially shore up the program, O’Malley will be a key player in the fierce partisan battle on Capitol Hill to address the SSA’s solvency.   

In a tweet with over 91,000 views after his nomination, O’Malley said: “Humbled and honored to be chosen by @POTUS to lead @Social Security into the future. President Biden believes Social Security is a sacred promise.  I look forward to earning the Senate’s approval and serving with the hardworking patriots of the U.S. Social Security Administration.” 

After firing Andrew Saul in July 2021, a hold-over from President Trump’s administration who refused to resign, Biden had named Kilolo Kijakazi, who served as SSA’s deputy commissioner for retirement and disability policy, as Acting SSA Commissioner.  Over her tenure, Kijakazi oversaw the Baltimore, Maryland based independent agency’s efforts to maintain customer service amid the COVID-19 pandemic that forced the closure of SSA field offices throughout the nation. With the agency’s staffing levels at a 25-year low, along with using outdated technology, customer service plummeted because of long waits for phones in-person service.

Now O’Malley is headed to replaces Kijakazi as Social Security Commissioner. If confirmed by the Senate, he will serve a six-year appointed term.  O’Malley will be directly responsible for all programs administered by SSA; for state-administered programs directed by SSA; and for certain functions with respect to the black lung benefits program.

Lots of experience under O’Malley’s belt

O’Malley’s background as two-term Mayor of Baltimore and two-term Governor of Maryland, where he adopted data and performance-driven and customer service technologies to tackle complex challenges, will be helpful as he grapples with how to manage an understaffed and underfunded agency that has reduced SSA’s ability to determine in a timely fashion eligibility of persons seeking retirement, survivor, and disability benefits, and updating benefits promptly when circumstances change.  He has written extensively about how to govern for better results by measuring the outputs of government on a real-time basis.  

During his time as mayor, O’Malley’s policies helped achieve the greatest crime reduction of America’s largest cities. Prior to being elected Mayor, he served as a member of the Baltimore City Council, and Assistant States Attorney for the City of Baltimore before that.

According to the Georgetown University’s Institute for Politics and Public Service, O’Malley was called the best manager in government by Washington Monthly magazine.  “Under his leadership Maryland achieved nation-leading progress: Best public schools in America for an unprecedented five years in a row (Education Week); one of the top states in the nation for holding down the cost of college tuition (College Board); and #1 in innovation and entrepreneurship for three years running (U.S. Chamber of Commerce).” 

In 2016, O’Malley ran for the Democratic Party’s nomination for President of the United States. He dropped out of the race in the winter of 2016 after placing third in the Iowa caucus. He also served two terms as chair of the Democratic Governors Association and was appointed to the nation’s first-ever Council of Governors by President Obama in 2010.

O’Malley received his bachelor’s degree from Catholic University and his law degree from the University of Maryland. Since 2016, he has lectured on public administration at numerous universities and institutions, including the University of Maryland, Harvard University, Georgetown University, and Boston College School of Law.

He and his wife, Katie, a District Court judge, have two daughters, Grace and Tara, and two sons, William and Jack.

Calls for O’Malley’s Senate Confirmation

On July 26, Democratic lawmakers and social security advocates were quick to issue statements of support, strongly endorsing and celebrating O’Malley’s nomination to be SSA Commission.  Here is a listing of a few of these endorsements:

Oregon Senator, Chair of the Senate Finance Committee, Ron Wyden: “Social Security needs a confirmed commissioner in order to ensure Americans are receiving the best service possible for their earned Social Security benefits. Governor O’Malley is a proven leader with experience running a large organization that millions of families count on. I look forward to moving this nomination through the Finance Committee as soon as possible.” [Statement, 7/26/23 – https://www.finance.senate.gov/chairmans-news/wyden-statement-on-omalley-nomination-to-lead-social-security

Connecticut Congressman John Larson: “I applaud President Biden for nominating a champion for Social Security, Martin O’Malley, to lead the Social Security Administration and move it forward to better serve current and future beneficiaries. Governor O’Malley has long supported protecting and expanding Social Security. He knows just how important this program is to our seniors and that the modest payments they live on are simply not enough. I look forward to working alongside him as we work to ensure SSA has the resources it needs to serve our most vulnerable Americans for decades to come.” [Statement, 7/26/23 – https://larson.house.gov/media-center/press-releases/larson-statement-biden-nomination-martin-omalley-commissioner-social

Nancy Altman, President, Social Security Works: “Social Security Works and I, personally, applaud the nomination of Governor O’Malley, a longtime Social Security champion. We will do all we can to ensure his swift confirmation.  We look forward to working with him, once confirmed, to secure more funding for SSA as the president requested and higher benefits, with no cuts, as he, President Biden, and indeed the Democratic Party, through its 2020 platform, have called for.” [Statement, 7/26/23 – https://socialsecurityworks.org/2023/07/26/martin-omalley-will-fight-for-social-security/

Max Richtman, President and CEO, National Committee to Preserve Social Security and Medicare: “We commend President Biden for nominating former Maryland governor Martin O’Malley as Social Security Commissioner. It has been more than 20 years since the Senate has confirmed a permanent commissioner nominated by a Democratic president, and it is way past time for the Social Security Administration (SSA) to have one. As a confirmed commissioner, Martin O’Malley will be able to advocate effectively for SSA, which has been chronically underfunded and has struggled to provide adequate customer service. 

As a presidential candidate in 2016, Governor O’Malley championed the expansion of Social Security. He proposed boosting benefits and adopting a more generous (the CPI-E) for calculating COLAs — while adjusting the payroll wage cap so that the wealthy pay their fair share.  He insisted that ‘it is our responsibility to ensure that Americans who put in a lifetime of hard work are able to retire with the dignity they deserve.’ American workers’ payroll taxes largely fund the SSA.  They have every right to expect the agency that administers their benefits to be fully funded — with a permanent commissioner at the helm. The Senate should confirm Governor O’Malley in a timely manner when it returns from August recess.”

Richard Fiesta, Executive Director, Alliance for Retired Americans: “Members of the Alliance for Retired Americans are pleased that President Biden has nominated former Maryland Governor Martin O’Malley to be the next Social Security Administration (SSA) Commissioner. The SSA needs a strong Commissioner now more than ever. With 10,000 Americans turning 65 each day, the workload increases every day, and the budget has been woefully inadequate to meet the needs of seniors, people with disabilities and all-American families. Gov. O’Malley has a proven track record and the experience to navigate these challenges and ensure that Americans are able to get the benefits they have earned. American workers have earned their Social Security benefits, paying into the system with every paycheck. They deserve world class service from a fully staffed workforce equipped with the best tools and technology available. The Alliance for Retired Americans is confident that under Governor O’Malley’s leadership SSA will deliver. There is no time to waste. We urge the Senate to confirm Gov. O’Malley without delay.”

As SSA’s Commissioner, O’Malley will become the point person for Biden to push for an increase in the agency’s administrative expenses to improve computer technology, open field offices across the nation to improve the agency’s customer service by reducing backlog and wait-time on phone to its 67 million beneficiaries. (https://retiredamericans.org/retirees-praise-biden-nomination-of-martin-omalley-to-be-social-security-commissioner/)

Final thoughts…

Like Biden, O’Malley calls for defending the Social Security program against Republican attack, supporting the expansion of Social Security benefits, and raising SSA taxes on higher income beneficiaries. With Senate Republicans opposing these policies and a razor-thin Democratic majority in the upper chamber, expect O’Malley’s nomination to squeak by in being confirmed.  After the Senate returns from its month-long August recess, Senate Majority Leader Chuck Schumer (D-New York) must quickly move to schedule a vote on O’Malley’s nomination.  SSA now needs its top leader in place to begin working to fix SSA’s ongoing issues of financial solvency and customer service issues.

For more details about O’Malley, go to https://en.wikipedia.org/wiki/Martin_O%27Malley.