Democratic lawmakers in the US Senate reach an agreement on prescription drug prices

(CNN) – Pressured to scrap plans to address prescription drug prices in the spending package promoted by the DemocratsSenate Majority Leader Chuck Schumer announced Tuesday that an agreement has been reached to reduce drug costs.

The agreement would allow Medicare to negotiate prices for certain expensive drugs administered in doctors’ offices or purchased at the pharmacy, according to a document distributed by Schumer’s office. The drugs would not be eligible until they were outside of their initial exclusivity periods of nine years for many cases and 12 years for others.

Medicare would negotiate prices for up to 10 drugs, starting in 2023, and these prices would take effect in 2025. The number would increase to 20 drugs starting in 2028. This is a much more limited proposal than the one supported by Democratic leaders in the House of Representatives.

The Senate deal would also impose a tax penalty if drug companies raise their prices faster than inflation, according to the White House. Half of drugs purchased in pharmacies exceed that threshold, according to a report from the Kaiser Family Foundation.

Main provisions

In addition, it would redesign Medicare Part D drug plans so that seniors and people with disabilities pay no more than $ 2,000 for drugs purchased at the pharmacy.

The agreement would also limit what Americans pay for insulin at $ 35 a monthaccording to Democratic Senator Ron Wyden of Oregon, who has worked on drug pricing legislation for years.

“Fixing the price of prescription drugs has consistently been a major issue for Americans year after year, including the vast majority of Democrats and Republicans who want to see change because they just can’t afford their drugs,” Schumer said, noting that the $ 1.75 trillion reconciliation bill could hit the Senate floor by week of November 15 if the House approves it this week.

Moderate Democratic Senator Kyrsten Sinema of Arizona, who helped curb the party’s original plan to allow Medicare negotiating the prices of certain drugsHe affirmed his support for the new agreement.

“The Senator welcomes a new agreement on a historic and transformative Medicare drug negotiation plan that will reduce out-of-pocket costs for seniors – ensuring that drug prices cannot rise faster than inflation – save dollars taxpayers, and protect innovation to ensure Arizonans and Americans continue to have access to life-saving drugs and new cures and therapies, “Sinema’s office said in a statement.

Reaction of pharmaceutical companies

Despite the tighter parameters of the deal, the pharmaceutical industry’s main lobby group said it would “jeopardize the same innovative ecosystem that brought us life-saving vaccines and therapies to combat COVID-19.”

“Under the guise of a ‘bargain,’ it gives the government the power to dictate how much a drug is worth and leaves many patients facing a future with less access to drugs and fewer new treatments,” said Stephen J. Ubl, CEO of PhRMA.

The agreement is not as comprehensive as the initial measure supported by many, but not all, House Democrats.

“Although not as broad as we had originally proposed, I am hopeful that the new inflation reimbursement and out-of-pocket cap for the elderly will work in conjunction with Medicare’s negotiating authority to significantly reduce prescription drug costs. for Americans, “said Committee on Energy and Commerce Chairman Frank Pallone, Jr., Democrat of New Jersey.

Agreement between Democrats

House Speaker Nancy Pelosi, who has lobbied to allow Medicare to negotiate, said she was “satisfied.”

The deal will likely produce less savings than the House proposal, which lawmakers say could offset up to $ 700 billion in spending.

“But it sets a significant precedent for a federal role in drug prices,” he tweeted. Larry Levitt, Kaiser’s Executive Vice President for Health Policy.

The initial proposal required the secretary of Health and Human Services to negotiate fair maximum prices for at least 50 and up to 250 high-cost drugs that lack competition, including insulin. The price would have been available to Medicare beneficiaries and to people enrolled in group health plans.

The House of Representatives passed a similar bill in 2019, but he got nowhere in the Senate, which was controlled by the Republicans at the time. It would have cut spending by $ 456 billion, according to an estimate by the Congressional Budget Office.

Dissident legislators

Although Democrats now lead both houses, not all members have agreed on what would be a historic change for Medicare.

Signs of trouble were evident as the House of Representatives was crafting the huge budget reconciliation bill in September. A small group of Democrats voted against key provisions on the price of medicines in two different commissions. The proposal was finally approved in the Ways and Means Committee, but the leadership can only afford to lose three Democratic votes for the bills to pass in plenary session of the House of Representatives.

Reaction to the announcement of the agreement was mixed among patient advocacy groups, with some calling it a breakthrough and others just a step forward.

“Stopping prices from rising faster than inflation and adding a hard out-of-pocket cap to Part D will bring real relief to seniors with the highest drug costs,” said AARP CEO Jo Ann Jenkins, over the spending limit at the pharmacy.
But Robert Weissman, president of Public Citizen, said the new agreement does not fully empower Medicare to negotiate prices.

“This agreement falls short of what Americans want and deserve to end the abusive prices of Big Pharma, but it is nonetheless a positive step,” Weissman said, based on terms previously reported Tuesday.

With information from Morgan Rimmer and Manu Raju.