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Five things to know about the new drug pricing negotiations

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1 year ago

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The Biden administration has picked the first 10 high-priced prescription drugs subject to federal price negotiations, taking a swipe at the powerful pharmaceutical industry. It marks a major turning point in a long-fought battle to control ever-rising drug prices for seniors and, eventually, other Americans.

Under the 2022 Inflation Reduction Act, Congress gave the federal government the power to negotiate prices for certain high-cost drugs under Medicare. The list of drugs selected by the Centers for Medicare & Medicaid Services will grow over time.

The first eligible drugs treat diabetes, blood clots, blood cancers, arthritis, and heart disease — and accounted for about $50 billion in spending from June 2022 to May 2023.

The United States is clearly an outlier on drug costs, with drugmakers charging Americans many times more than residents of other countries “simply because they could,” Biden said Tuesday at the White House. “I think it’s outrageous. That’s why these negotiations matter.”

He added, “We’re going to keep standing up to Big Pharma and we’re not going to back down.”

Democratic lawmakers cheered the announcement, and the pharmaceutical industry, which has filed a raft of lawsuits against the law, condemned it.

The companies have until Oct. 2 to present data on their drugs to CMS, which will make initial price offers in February, setting off negotiations set to end next August. The prices would go into effect in January 2026.

Here are five things to know about the impact:

1. How important is this step?

Medicare has long been in control of the prices for its services, setting physician payments and hospital payments for about 65 million Medicare beneficiaries. But it was previously prohibited from involvement in pricing prescription drugs, which it started covering in 2006.

Until now the drug industry has successfully fought off price negotiations with Washington, although in most of the rest of the world governments set prices for medicines. While the first 10 drugs selected for negotiations are used by a minority of patients — 9 million — CMS plans by 2029 to have negotiated prices for 50 drugs on the market.

“There’s a symbolic impact, but also Medicare spent $50 billion on these 10 drugs in a 12-month period. That’s a lot of money,” said Juliette Cubanski, deputy director of KFF’s analysis of Medicare policy.

The long-term consequences of the new policy are unknown, said Alice Chen, vice dean for research at University of Southern California’s Sol Price School of Public Policy. The drug industry says the negotiations are essentially price controls that will stifle drug development, but the Congressional Budget Office estimated only a few drugs would not be developed each year as a result of the policy.

Biden administration officials say reining in drug prices is key to slowing the skyrocketing costs of U.S. health care.

2. How will the negotiations affect Medicare patients?

In some cases, patients may save a lot of money, but the main thrust of Medicare price negotiation policy is to provide savings to the Medicare program — and taxpayers — by lowering its overall costs.

The drugs selected by CMS range from specialized, hyper-expensive drugs like the cancer pill Imbruvica (used by about 26,000 patients in 2021 at an annual price of $121,000 per patient) to extremely common medications such as Eliquis (a blood thinner for which Medicare paid about $4,000 each for 3.1 million patients).

While the negotiations could help patients whose Medicare drug plans require them to make large copayments for drugs, the relief for patients will come from another segment of the Inflation Reduction Act that caps drug spending by Medicare recipients at $2,000 per year starting in 2025.

3. What do the Medicare price negotiations mean for those not on Medicare?

One theory is that reducing the prices drug companies can charge in Medicare will lead them to increase prices for the privately insured.

But that would be true only if companies aren’t already pricing their drugs as high as the private market will bear, said Tricia Neuman, executive director of KFF’s program on Medicare policy.

Another theory is that Medicare price negotiations will equip private health plans to drive a harder bargain. David Mitchell, president of the advocacy group Patients for Affordable Drugs, predicted that disclosure of negotiated Medicare prices “will embolden and arm private sector negotiators to seek that lower price for those they cover.”

Stacie B. Dusetzina, a professor of health policy at Vanderbilt University, said the effect on pricing outside Medicare isn’t clear.

“I’d hedge my bet that it doesn’t change,” she said.

Nonetheless, Dusetzina described one way it could: Because the government will be selecting drugs for Medicare negotiations based partly on the listed gross prices for the drugs — distinct from the net cost after rebates are taken into account — the process could give drug companies an incentive to lower the list prices and narrow the gap between gross and net. That could benefit people outside Medicare whose out-of-pocket payments are pegged to the list prices, she said.

4. What are drug companies doing to stop this?

Even though negotiated prices won’t take effect until 2026, drug companies haven’t wasted time turning to the courts to try to stop the new program in its tracks.

At least six drug companies have filed lawsuits to halt the Medicare drug negotiation program, as have the U.S. Chamber of Commerce and the Pharmaceutical Research and Manufacturers of America, known as PhRMA.

The lawsuits include a variety of legal arguments. Merck & Co., Johnson & Johnson, and Bristol Myers Squibb are among the companies arguing their First Amendment rights are being violated because the program would force them to make statements on negotiated prices they believe are untrue. Lawsuits also say the program unconstitutionally coerces drugmakers into selling their products at inadequate prices.

“It is akin to the Government taking your car on terms that you would never voluntarily accept and threatening to also take your house if you do not ‘agree’ that the taking was ‘fair,’” Janssen, part of Johnson & Johnson, wrote in its lawsuit.

Nicholas Bagley, a law professor at the University of Michigan, predicted the lawsuits would fail because Medicare is a voluntary program for drug companies, and those wishing to participate must abide by its rules.

5. What if a drug suddenly gets cheaper by 2026?

In theory, it could happen. Under guidelines CMS issued this year, the agency will cancel or adjourn negotiations on any drug on its list if a cheaper copycat version enters the market and finds substantial buyers.

According to company statements this year, two biosimilar versions of Stelara, a Johnson & Johnson drug on the list, are prepared to launch in early 2025. If they succeed, it would presumably scotch CMS’ plan to demand a lower price for Stelara.

Other drugs on the list have managed to maintain exclusive rights for decades. For example, Enbrel, which the FDA first approved in 1998 and cost Medicare $1.5 billion in 2021, will not face competition until 2029 at the earliest.

KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF—an independent source of health policy research, polling, and journalism. Learn more about KFF.

This article first appeared on Mississippi Today and is republished here under a Creative Commons license.

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Meet the 2 Candidates for Mississippi Supreme Court’s Nov. 26 Runoff Election

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9 hours ago

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November 25, 2024

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mississippitoday.org – The Marshall Project – 2024-11-25 09:30:00

On Tuesday, Nov. 26, voters will determine who will hold one of central Mississippi’s three seats on the nine-member state Supreme Court. This 22-county area includes Hinds County and Jackson.

Justice Jim Kitchens is seeking a third, eight-year term on the high court. State Sen. Jenifer B. Branning is the challenger.

The state Supreme Court often has the final say in cases involving criminal, civil and death penalty appeals, questions on the state’s laws and constitution, and legal issues of public interest. It hears appeals from lower courts, such as the chancery and circuit courts. The court decided 260 cases in 2023 and issued rulings in 2,656 motions and petitions.

The Marshall Project – Jackson and Mississippi Today compiled information about each candidate to help you make an informed decision at the polls.

Admitted to Mississippi Bar: 1967

Residence: Crystal Springs, Copiah County

Relevant experience: Completing second term as Supreme Court justice; 41 years as practicing attorney, including nine as district attorney of Copiah, Walthall, Pike and Lincoln counties.

Campaign finance: As of Oct. 10, his campaign committee has raised $288,502, mostly from trial lawyers, and spent $189,675, leaving the campaign with $98,827. Read the latest report here.

Statement of economic interest: Kitchens and his wife are partners in a real estate company, Kitchens Properties, LLC, in Copiah County. Read the latest report here.

Kitchens was first elected to this seat in 2008, after more than 40 years practicing law, which includes nine years as a district attorney across four counties. He is one of two presiding justices, who have the most years on the bench, following the chief justice. Presiding justice is a role on the court’s executive committee that includes administrative duties, such as enforcing the court’s deadlines, and presiding over panels during oral arguments.

Campaigning at the 2024 Neshoba County Fair, Kitchens stressed his experience in the courtroom, especially on criminal cases, and promised impartiality.

Kitchens said he is “the guy that carries his oath of office around in his pocket as a daily reminder of what he swore to do. That oath teaches me that I’m not supposed to care whether people before the court are rich, poor, Black, White, Republican, Democrat, Libertarian or Independent. And I don’t care.”

Mississippi College of Law Professor Matthew Steffey described Kitchens as a “middle-of-the-road centrist.” On the bench, Kitchens’ dissents have keyed in on what the justice called oversteps in judicial power and scrutinized prosecutorial decisions.

Kitchens wrote a partial dissent on the decision about House Bill 1020, calling the creation of the court in Hinds County a “fiction of convenience that overreaches our judicial function, and of ultimate importance, our constitutional duty.” He also joined a dissenting opinion in the case that killed Mississippi’s ballot initiative.

Ensuring defendants who can’t afford representation have court-appointed lawyers is a theme throughout Kitchens’ career. He was the chair of the Public Defender Task Force, which was created in 2000 to study and make recommendations on the public defender systems in the state. In a 2018 interview with Mississippi Today, Kitchens expressed support for a more well-organized and adequately funded state public defender system for Mississippi.

The bulk of Kitchens’ campaign donations through Oct. 10 have come from trial lawyers. In addition to Mississippi attorneys, the campaign also received contributions from lawyers as far away as Oregon and Pennsylvania. In the three months since the July finance report, Kitchens’ campaign raised over $200,000, more than it had previously raised in the entire race. He has also received an endorsement from the Southern Poverty Law Center, an advocacy group specializing in civil rights litigation.

? Read Kitchens’ response to the candidate questionnaire from The Marshall Project – Jackson and Mississippi Today.

Admitted to Mississippi Bar: 2004

Residence: Philadelphia, Neshoba County

Relevant experience: State senator since 2016.

Campaign finance: As of Oct. 10, Branning’s campaign committee has raised $665,624, including a $250,000 loan from the candidate, and spent $343,728. The campaign reported a balance of $319,876, which left a discrepancy of about $2,000. Read the latest report here.

Statement of economic interest: Branning is listed as member, owner, stockholder or partner in several companies located in Philadelphia, including her law firm, Branning Properties, LLC, and Triple E Investments. Read her latest report here.

Republican state Sen. Jenifer B. Branning is running on a platform to represent Mississippians’ conservative values on the Supreme Court, she said at the 2024 Neshoba County Fair candidate forum.

Branning has no judicial experience. Since she joined the Mississippi Bar in 2004, she has practiced as an attorney, primarily representing businesses through her private practice in areas including real estate development, banking and agribusiness. She has also served as a special prosecutor in Neshoba County, a guardian ad litem in Neshoba and Winston counties, and as a staff attorney in the Mississippi Secretary of State’s Division of Business Services & Regulation.

Branning described herself as a “Christian conservative.” She has been endorsed by the state’s Republican Party and the National Federation of Independent Business Mississippi PAC, a special interest group for small businesses. She has been outspoken about overturning Roe v. Wade and supporting the state’s abortion ban, and about reducing taxes on businesses. Branning is also a member of the National Rifle Association. On criminal justice issues, Branning has voted in favor of mandatory and increased minimum sentences for crimes including shoplifting, motor vehicle theft and fleeing law enforcement.

In the state Senate, Branning chairs the Highways and Transportation Committee. She has touted her record on lowering taxes and reducing regulations on farmers and small business owners.

Branning comes from multiple generations of business owners in Neshoba County. Her grandfather, Olen Burrage Jr., owned and operated a truck farm, hauling timber and corn, according to previous news reports.

Her election committee has received contributions from political action groups including Truck PAC, Mississippi Petroleum Marketers & Convenience Stores Association PAC and the Mississippi REALTOR PAC.

Much of Branning’s campaign funding, however, comes from the candidate herself. She kicked off her campaign with a $250,000 candidate loan. She has also bankrolled her previous senate campaigns, with candidate loans as high as $50,000 in 2018. This year, her campaign committee also received funding from other Republican politicians and their campaign funds, including Lt. Gov. Delbert Hosemann, the Committee to Elect Jeremy England (state senator), Harkins for MS (state Senator Josh Harkins), and Friends of Jason White (Mississippi House speaker).

Branning did not acknowledge or return the candidate questionnaire from The Marshall Project – Jackson and Mississippi Today.

This article first appeared on Mississippi Today and is republished here under a Creative Commons license.

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On this day in 1915

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9 hours ago

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November 25, 2024

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mississippitoday.org – Jerry Mitchell – 2024-11-25 07:00:00

Nov. 25, 1915

Credit: Wikipedia

A week before the silent film, “Birth of a Nation,” premiered at an Atlanta theater, William Simmons, along with 15 other men (including some who lynched Leo Frank) burned a cross on Stone Mountain, Georgia, signaling the rebirth of the Ku Klux Klan. 

The movie’s racist portrayals of Black Americans prompted outrage by the NAACP and others, leading to huge protests in towns such as Boston and the film’s closing in Chicago. 

Despite these protests, the movie became Hollywood’s first blockbuster, making as much as $100 million at the box office (the equivalent of $2.4 billion today). In the wake of the movie, the KKK became a national organization, swelling beyond 4 million members.

This article first appeared on Mississippi Today and is republished here under a Creative Commons license.

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Podcast: Mississippi Hospital Association’s Roberson discusses Medicaid expansion outlook under Trump, other 2025 legislative health care issues

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11 hours ago

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November 25, 2024

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mississippitoday.org – Bobby Harrison and Geoff Pender – 2024-11-25 06:30:00

Richard Roberson, president and CEO of the Mississippi Hospital Association, tells Mississippi Today’s Bobby Harrison and Geoff Pender a new Trump administration would likely approve Mississippi Medicaid expansion work requirements. He says revamping the state’s certificate of need laws is likely to be a major issue before lawmakers, and he discusses a new alliance of hospitals that left the MHA and formed a new organization.

READ MORE: As lawmakers look to cut taxes, Mississippi mayors and county leaders outline infrastructure needs

This article first appeared on Mississippi Today and is republished here under a Creative Commons license.

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