Trump administration pitches an end to certain drug rebates - STAT

Trump administration pitches an end to certain drug rebates - STAT

Trump administration proposes big drug pricing change

The Trump administration just rolled out one of its boldest proposals yet to lower prescription drug prices: curbing some types of drug rebates the administration says are responsible for driving up costs. Here’s the rundown:

• The proposal: It would prevent drug companies and pharmacy benefit managers from negotiating rebates in exchange for making it easier for patients to get access to certain drugs. But the proposal would explicitly allow drug companies and PBMs to negotiate rebates as long as the savings are passed directly to consumers at the pharmacy. The proposal technically only affects Medicare, but might also have a more sweeping impact on private plans.
• The impact: Health secretary Alex Azar said the proposal has the potential to "finally ease the burden of the sticker shock that millions of Americans experience every month for the drugs they need." According to estimates cited by HHS, the proposal would raise premiums for Medicare enrollees, but the amount of money they spend at the pharmacy could go down. The amount of money patients and the government might save — or how much more they have to spend — will depend on what drug companies, PBMs, and insurers do in response.
• The next steps: The proposed rule will be open for comments for 60 days, and, if implemented, would take effect on Jan. 1, 2020.

STAT's Ike Swetlitz and Nicholas Florko have more here.