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All of the primary manufacturers of the 10 drugs selected in August for Medicare price negotiations have signed on to participate in the program, the White House said Tuesday.
The announcement comes in the wake of Sunday’s deadline for the affected drugmakers to sign agreements to engage in the initial round of drug-price negotiations under last year’s Inflation Reduction Act, with negotiated prices to take effect in 2026. Industry hopes for a last-minute legal reprieve ahead of that deadline were quashed late Friday when a federal court judge in Ohio denied the U.S. Chamber of Commerce’s request for a preliminary injunction that could have put the program on pause before Oct. 1.
The 10 drugs selected for negotiation — which include blockbusters like the Bristol Myers Squibb Co.
BMY,
blood thinner Eliquis, Boehringer Ingelheim heart-failure drug Jardiance, and Merck & Co. Inc.
MRK,
diabetes drug Januvia — accounted for $3.4 billion in total out-of-pocket costs for roughly 9 million Medicare enrollees in 2022, the White House said. The selected drugs’ average 2022 out-of-pocket costs for Medicare Part D enrollees ranged from $261 for the Novo Nordisk
NVO,
insulins Fiasp and NovoLog to $6,497 for Imbruvica, the blood cancer treatment made by Pharmacyclics LLC, a unit of AbbVie Inc.
ABBV,
the White House said.
The companies behind the selected drugs “manufacture some of the costliest and commonly-used prescription drugs that are used to treat arthritis, diabetes, Crohn’s disease, cancer and more,” a White House official said.
New legal challenges to the program are still emerging, with Novo Nordisk on Friday becoming the latest industry player to sue the federal government over the program. The lawsuit alleges in part that regulators violated the law by grouping together products with the same active ingredient and effectively selecting more than 10 individual drugs for the first round of negotiations. Novo Nordisk insulin products sold under the brand names Fiasp and NovoLog were together named as one of the 10 drugs selected for negotiation.
There are now at least nine pending lawsuits challenging the program.
The White House used the announcement Tuesday to underscore Republicans’ lack of support for the IRA and the negotiation program. “House Republicans are even endorsing Big Pharma’s lawsuits to protect their capacity to charge exorbitant prices free from negotiation,” White House Deputy Press Secretary Andrew Bates wrote in a memo Tuesday, pointing to comments from Rep. Morgan Griffith, Republican of Virginia, about the first legal challenge to the program, filed by Merck.
“My thought is, of course Merck sued, and every drug manufacturer probably ought to sue, because it is on its face an unconstitutional taking,” Griffith said at a June hearing, referring to the excise tax drugmakers can face if they don’t engage in the negotiations.
Several drugmakers signaled in recent days that they were signing the negotiation agreements under protest, saying they had little choice because companies that don’t participate may face the excise tax on sales of the selected drug, or alternatively may have to withdraw all their products from the Medicare and Medicaid programs.
Monday was the deadline for the affected drugmakers to submit data for Medicare to consider in negotiating a maximum fair price for the selected drugs.
A Johnson & Johnson
JNJ,
spokesperson said Monday that the company is moving ahead with the negotiation program’s requirements although it continues to believe the IRA’s drug-pricing provisions “are damaging to the innovation ecosystem that delivers transformative therapies and cures to patients.”
AbbVie said in a statement Friday that it will participate in the process “despite it not representing a legitimate negotiation. Our engagement does not change or waive our position that the ‘negotiation’ program created by the IRA is unconstitutional, involuntary and threatens the future of scientific advancement for patients in the U.S. and around the world.”
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