The Trump administration’s Centers for Medicare & Medicaid Services (CMS) has signaled that it will be revamping the process of negotiating prices for certain Medicare Part D drugs with input from external stakeholders, sparking some alarms from Democrats who support the program.
A one-paragraph press release issued Wednesday speaks to the Medicare Drug Price Negotiation Program, for which Biden’s CMS shared a list of 15 selected drugs released Jan. 17. These products will undergo price negotiations through 2025 with an eventual negotiated price going into effect in 2027.
The program is a statutory requirement of 2022’s Inflation Reduction Act (IRA) and builds on the 10 drugs subject to negotiations during the inaugural 2024 year. Biden’s CMS said the 15 drugs to be negotiated in 2025—which include high-profile GLP-1 treatments like Ozempic, Wegovy and Rybelsus—account for more than a third of beneficiaries’ spending.
The Medicare Drug Price Negotiation Program is broadly opposed by drugmakers, who have filed several legal challenges against the program’s rollout, and Republican lawmakers who say its price-setting harms pharmaceutical innovation.
The negotiation process between the CMS and drug companies supports a timeline of negotiation meetings between the two parties and allows the drugmakers to submit a written counteroffer to the agency’s opening price. Guidance distributed in October covering the program’s second year showed plans for the CMS to allow additional closed-door meetings and counteroffer submissions from drugmakers if the initial offer is rejected—though the agency still makes the final call on a product’s negotiated price.
Wednesday’s CMS release reaffirmed the program as a statutory requirement and does not suggest any plans to block its continued operation. However, it does suggest some changes could be coming to implementation of the negotiations.
The CMS release reads, “[a]s the second cycle begins under the Trump Administration, CMS is committed to incorporating lessons learned to date from the program and to considering opportunities to bring greater transparency in the Negotiation Program. CMS intends to provide opportunities for stakeholders to provide specific ideas to improve the Negotiation Program, consistent with the goals of achieving greater value for beneficiaries and taxpayers and continuing to foster innovation.”
Wednesday’s CMS statement has come under quick scrutiny from Democrats on the Senate Finance Committee, who said Thursday the language “open[s] the door to Big Pharma’s requests” to weaken the program’s teeth.
The 13 lawmakers directed their concerns to Robert F. Kennedy Jr., Trump’s nominee for secretary of the Department of Health and Human Services, who has been facing confirmation hearings. In a letter penned during the two-day process, they contrasted the CMS’ release to his testimony that the president and department were committed to lowering drug prices.
“Contrary to what you suggested in [Wednesday]’s hearing, the Trump Administration’s statement is far from an embrace of drug price negotiation and appears to be opening the door to changes that could undermine Medicare’s ability to get the best price possible on drugs,” they wrote.
The finance committee Democrats’ letter requested on-the-record responses from RFK Jr. on 12 questions related to: Medicare drug price negotiation, specific “wish list” adjustments to the program’s implementation supported by the pharmaceutical industry and the influence of the pharmaceutical industry on the Trump administration.
The questions continued during RFK Jr.’s second confirmation hearing Thursday in front of the Senate Health, Education, Labor and Pensions (HELP) Committee, when Sen. Hickenlooper, D-Colorado, and ranking member Bernie Sanders, D-Vermont, asked the appointee to commit to lowering prices through the negotiation program.
RFK Jr., in response to Hickenlooper, said that he had spoken with Trump about the program and that “he’s absolutely committed to negotiating lower drug prices.”
To Sanders, RFK Jr. said that “President Trump wants us to negotiate drug prices,” though the senator responded that the word “negotiate” leaves a lot to interpretation.
Sanders then asked RFK Jr. directly whether he would abide by the IRA, to which RFK Jr. responded, “I’m going to comply with the law, senator. Congress passed the law, I’m swearing an oath to the Constitution, I’m going to comply with the laws.”
The potential for a warm relationship between RFK Jr. and the pharmaceutical industry is at odds with his history of anti-vaccine rhetoric and stance that the nation's children are being overmedicated for conditions such as attention-deficit disorder. He has also received millions of dollars through his support for lawsuits on adverse safety events that target pharmaceutical companies, according to his ethical disclosures. The nominee laughed in response to a confirmation hearing question on whether he would accept money from pharmaceutical companies, telling lawmakers, “I don’t think they want to give me money, by the way.”
Still, Democrats said during the confirmation hearings that they are concerned RFK Jr. would back off from some of his personal positions under pressure from Trump and Republicans. Additionally, though drugmakers' stock prices took an immediate hit when RFK Jr.'s nomination was unveiled, pharmaceutical executives have downplayed concerns that RFK Jr.'s appointment could substantially harm their business.