Drug Price Negotiations Announced
CMS announced the results of their first ever drug price negotiations. As a result of the Inflation Reduction Act CMS negotiated the price of 10 drugs, to be effective January 1, 2026. According to CMS:
“Compared to 2023 Medicare spending net of all rebates and certain fees and payments, if the prices agreed to between CMS and participating drug companies under the Negotiation Program had been in effect during 2023, the negotiated prices would have saved an estimated $6 billion in net covered prescription drug costs, which would have represented 22% lower net spending in aggregate.”
It’s important to note that there remains ongoing litigation on the topic so the ultimate 2026 effects may differ from what CMS is reporting.
In terms of next steps, CMS must provide information on how it arrived at the prices by March 1, 2025. CMS also will publish guidance by February 1, 2025, on which drugs will be selected for the next round of negotiations, which go into effect in 2027.
Economy
Positive inflation data was released this week. CPI data had inflation falling below 3% for the first time since 2021. The federal reserve is expected to lower interest rates when it meets in September, which would lower the chances for a recession.
Covid
Covid cases in the US continue to rise. The current spike in Covid cases may represent the highest number of summer cases in several years. In addition to number of cases increasing, there’s also been increases in hospitalization and deaths.
