Timeline for 2nd Cycle
As we reported in the last (April) Voice, the federal Centers for Medicare and Medicaid Services (CMS) is proceeding forward with its 2nd cycle of negotiations. They will conclude with the new maximum fair price (MFP) for each of the 15 drugs, listed in the April Voice, becoming effective on January 1, 2027.
This is happening despite the fact that pharmaceutical manufacturers and their trade associations are continuing their challenges against the Program in the courts and with the Trump administration and Congress. While their efforts to kill or otherwise undermine the Program have proven unsuccessful so far, we’re closely monitoring the situation.
During March and April, CMS hosted patient-focused and clinical-focused public engagement sessions. That includes patient-focused roundtable events and a town hall meeting focused on clinical considerations.
As of this June, CMS has sent an initial offer of a MFP for a selected drug to each participating drug company. Here’s what is planned during the remainder of this year.
Focus on “Most Favored Nation” Policy
Efforts at reducing Rx drug prices hasn’t stopped with the CMS negotiations. Recently President Trump issued an executive order that seeks on several fronts to cut drug prices here to align with the significantly lower ones abroad.
His executive order seeks to implement what is known as the “most favored nation” drug pricing policy which aims to reduce U.S. prices to those in other countries. As we went to press, details on how the administration will fully implement this policy remain unclear.
For example, the executive order did not specify to which drugs it will be applied. That said, it requires U.S. Health and Human Services Secretary Robert F. Kennedy Jr. to set clear targets for price reductions across all U.S. markets within 30 days.
If “adequate progress” is not made toward those targets, then Secretary Kennedy will impose the most favored nation pricing on the drugs through rulemaking. Also, the order directs the U.S. Department of Justice and Federal Trade Commission to aggressively enforce “anti-competitive actions” that keep prices high in this country.
If the pharmaceutical manufacturers’ response to the CMS’s ongoing drug price negotiations is any indication, then legal challenges to this executive order can be expected. As major developments occur, we will be updating our members here as well as in weekly messages/ videos.