Drug Pricing and Affordability
Keep up with our comprehensive coverage of administrative and legislative activity and what it means for industry, plans, providers, and patients.
Biden Orders HHS to Test Medicare, Medicaid Drug Pricing Models
President Biden’s executive order directs HHS to identify CMMI model options that could lower drug costs and promote access for Medicare and Medicaid enrollees.
Inflation Reduction Act Renews Focus on Value Assessment in the US
Government price-setting provisions in the IRA have highlighted the diverse nature and interpretation of value across the US healthcare system.
New Analysis of Trends in Part D Generic Tiering, Pricing, and Patient Spending
New Avalere analysis examines longitudinal trends across a cohort of generic drugs, finding increases in aggregate patient spending over time and in placement on higher tiers in Medicare Part D.
Drug Pricing Bill Could Reduce Manufacturer Revenue by Over $450B
Analysis of updated Senate drug pricing legislation shows Medicare negotiation could reduce manufacturer revenues by $165 billion in Part D and $290 billion in Part B from 2026 to 2032.
Updated Reconciliation Package Changes Drugs Eligible for Negotiation
An updated Avalere analysis finds that under the changes to the negotiation policy included in the revised version of the Senate reconciliation package, the 100 Medicare Part B and D drugs that are likely to be selected for government negotiation from 2026–2031 represent almost half (45%) of all Part B and D drug spending in 2020.
2024 Part D Bid Cycle Introduces New Considerations for Stakeholders
As Part D plans and manufacturers begin to prepare for the upcoming calendar year (CY) 2024 bid cycle, the evolving Part D market and policy landscape may significantly shape plan bid and formulary management strategies.
Some Medicare Part D Beneficiaries Pay Full Price for Generic Drugs
An Avalere analysis finds that, in 2020, 63% of Medicare Part D beneficiaries paid the full cost of their generic medications at least once during their initial coverage phase when the generics were on the preferred brand tier.
The Rare Disease Market: Policy Changes and Coverage Trends
Changes to rare disease policies and payers’ approaches to coverage could have significant impacts on product development, patient access, and reimbursement.
Value-Based Arrangement Pricing Flexibilities Will Take Effect July 1
Starting July 1, manufacturers can report multiple best prices for some value-based arrangements, which may encourage broader use of innovative contracting.
More than 100 Drugs May Be Eligible for Negotiation Under BBBA by 2030
Avalere analysis estimates more than 120 drugs may be eligible for negotiation under the BBBA by 2030. This count reflects the cumulative nature of the policy.
Part B Drug Negotiation Under BBBA Would Reduce Payments to Providers
New Avalere analysis finds that the latest version of Medicare negotiation in the Build Back Better Act (BBBA) would lead to a 40% cut on average for Medicare providers that furnish the Part B drugs that are likely to be initially targeted for negotiation.
Some Part D Beneficiaries May Pay Full Price for Certain Generic Drugs
Avalere analysis finds that when generics in Part D are placed on the preferred brand tier some patients pay the full cost for their drugs.
Series of Changes to Drug Pricing Metrics Will Interact in Coming Years
The intersection of upcoming changes to drug pricing metrics will require new methods of calculating and reporting government pricing with implications for net pricing and contracting strategies.
Pending ASP Changes Impact Payments & May Shape Future FDA Filings
Beginning July 1, 2021, average sales price (ASP) calculations for Part B drugs with an additional non-covered self-administered formulation could alter Medicare reimbursement.
2021 State Drug Pricing Legislation: The Evolution Beyond Transparency
The majority of state legislatures are currently in session, and many states are taking steps to address prescription drug spending and prices through a range of legislative proposals. While states have historically focused on price transparency, state policymakers are now moving beyond those measures to more directly control prescription drug prices through reference pricing, affordability review boards setting upper payment limits, and other price control mechanisms.
Majority of Part D Spending Is on Brand Drugs in Classes with Generics
With Congress likely to consider a second reconciliation bill in the near future that may include various drug-pricing and Medicare Part D reform policies as spending offsets, an updated Avalere analysis examines spending across classes with various availability of brand and generic drugs.
Three Considerations for 2021 Drug Pricing Reform Outlook
A second reconciliation package could include significant drug pricing reforms as a means to pay for permanent coverage expansion and other top priorities.
Generic Drug Placement on Part D Generic Tiers Declines Again in 2021
A new analysis from Avalere finds that in 2021, Medicare Part D plans place generic prescription drugs on generic tiers 45% of the time, a decrease from 64% in 2016.
Copay Accumulator and Maximizers: Evolving Policy Landscape
Implementation of copay accumulator and maximizer programs continues to increase; recent policy provisions finalized through federal rulemaking and state-level legislation have created new uncertainty for the future of these programs and the stakeholders they affect.
MFN Model Would Have Had a Major Impact on Certain Providers
New Avalere analysis finds that the the Most Favored Nation (MFN) Model would have a significant negative impact on Medicare providers that furnish Part B drugs—especially in oncology and rheumatology—and those in rural areas.