The Biden administration recently announced that it will impose inflation penalties on 64 prescription drugs for the third quarter of this year. This move is in line with President Joe Biden’s commitment to lowering drug prices in the United States, particularly for older Americans enrolled in Medicare. The administration’s initiative is part of the Inflation Reduction Act, which holds drug manufacturers accountable for hiking drug prices faster than the rate of inflation.
The inflation penalties imposed on certain prescription drugs under Medicare Part B will result in lower costs for patients. With the provision requiring drugmakers to pay rebates to Medicare, older Americans will benefit from reduced coinsurance rates for the specified medications. This will provide relief for more than 750,000 Medicare patients who rely on these drugs to treat conditions such as cancer, infections, and osteoporosis.
The list of prescription drugs subject to inflation penalties includes treatments from pharmaceutical companies like Bristol Myers Squibb, Pfizer, and Astellas Pharma. For instance, Bristol Myers Squibb’s Abecma, a cell therapy for multiple myeloma, and Pfizer’s Adectris, a targeted cancer treatment for certain lymphomas, are among the medications covered. These drugs, along with others on the list, have seen price increases surpassing the rate of inflation, prompting the need for rebates to Medicare.
Preventing Overpricing by Drugmakers
The Biden administration’s initiative aims to prevent drugmakers from excessively raising prices without justification. By holding them accountable through inflation penalties and rebates to Medicare, the government is taking a stand against price hikes that disproportionately burden older Americans on fixed incomes. The Centers for Medicare & Medicaid Services will play a crucial role in overseeing the implementation of these penalties and ensuring that drugmakers comply with the provisions of the Inflation Reduction Act.
Looking Ahead
With the enforcement of inflation penalties on prescription drugs, the Biden administration is signaling its commitment to addressing the issue of skyrocketing drug prices in the U.S. This proactive approach aligns with President Biden’s broader health-care agenda and reelection platform for 2024. By promoting affordability and access to essential medications for Medicare beneficiaries, the administration is working towards a more equitable healthcare system that prioritizes the needs of older Americans.