Updated April 7, 2023 with comments from HHS
The Department of Health and Human Services’ (HHS') highly publicized list of the first Medicare Part B prescription drugs hit with rebates under the Inflation Reduction Act discreetly dropped from 27 to 20, prompting critiques from the pharma lobby over the Biden administration’s swift implementation of the legislation’s drug controls.
As spotted by Endpoints, the press release and accompanying guidelines released by HHS were updated on March 30 with the removal of several previously listed drugs: Gilead’s Yescarta and Tecartus, Bausch + Lomb’s Xipere, Acrotech Biopharma’s Folotyn, Shionogi’s Fetroja, Kamada’s WinRho and Stemline Therapeutics’ Elzonris.
Drugs included on HHS’ list were those with price increases that outpaced the rate of inflation. Under last year’s legislation, the manufacturers of those products are required to repay Medicare the difference via rebates, the savings from which the Centers for Medicare & Medicaid Services would then pass along to enrollees.
The discounts were also heavily touted by President Joe Biden as a major victory against the pharma industry’s “exorbitant profits at the expense of the American people.”
“You name the drug you have to take, and I can take you to France and get it a hell of a lot cheaper, [or] to Canada and throughout Europe,” Biden said during a March 15 speech to reporters. “It’s not fair. But after decades of trying to take on Big Pharma, we finally, finally won.”
In an emailed statement, the Centers for Medicare and Medicaid Services said the change was the result of a "standard procedure" in which the the agency releases the Average Sales Price public files ahead of the quarter before they go into effect for public review and potential adjustment.
"Last week, CMS issued a restatement correcting the calculation of the coinsurance adjustment percentage for Part B rebatable drugs," the agency wrote in its statement. "We have updated the files and supplemental materials to reflect the accurate calculations and updated the list of now 20 drugs for which reduced coinsurance applies."
The agency now expects Medicare enrollees could save anywhere from $1 to $372 per average dose of their prescriptions during the period begun April 1 as a result of the price cap—a slight adjustment from the $2 to $390 range highlighted back in March.
HHS has not publicly stated why it walked back the initial list of affected drugs. Fierce Healthcare has reached out to the department for any additional comment.
In an emailed statement, a representative of industry group PhRMA said “it’s fair to ask what else the administration may be getting wrong” as it “races to implement an unprecedented government price-setting scheme with little time. It’s also further evidence of why it’s critical to have a robust and timely process in place to address concerns with the law’s implementation.”
The statement also reiterated PhRMA’s earlier talking points that the vast majority of Part B treatments, about 95%, are unaffected by the administration’s rebate cutoff. The group said that Part B-covered medicines “have long grown below the rate of inflation … because prices for medicines under Part B already benefit from robust negotiations that take place in the private market.”
HHS plans to send invoices for the remaining 20 listed products to drug manufacturers “no later than fall 2025.”
Meanwhile, the administration is targeting 2026 for the implementation of another Inflation Reduction Act-permitted price control, the Medicare Drug Price Negotiation Program.
In mid-March, the administration released initial guidance on how it would select and negotiate “maximum fair prices” for up to 10 Medicare Part D drugs, with more products to follow in later years. It is currently seeking public comments on the proposed process.