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Author: Admin | 2025-04-28
Achieved. On average, Medicare negotiated prices are 2.8 times the average of drug prices in the 11 comparable countries. While the drug industry has strenuously objected to the Medicare drug negotiation program and argued that it will stifle innovation, this analysis shows that the price concessions negotiated thus far are modest in comparison to those seen in other countries. Medicare negotiated drug prices are lower than list prices and VA negotiated drug prices For each of the 10 drugs selected for negotiation in 2024, the table above compares the 2024 list price, the price negotiated for Medicare by the Biden Administration, and the maximum price for the “Big Four” agencies – the VA, Department of Defense, Public Health Service, and Coast Guard – which are negotiated by the VA. (Note that the Big Four agencies can pay lower prices than listed above through temporary discounts or, for the VA and Department of Defense, through bulk purchase orders). Although the Medicare negotiated drug prices represent a significant discount from the corresponding list prices, list prices do not account for any rebates or discounts that are currently negotiated for these drugs and are thus higher than the pre-negotiation net prices that Medicare Part D plans have been paying. Big Four drug prices were higher than the new Medicare negotiated prices for all 10 drugs, which represents a change from a prior Congressional Budget Office analysis that showed that Big Four prices for top-selling brand-name drugs were 20% lower on average than net prices paid by Medicare Part D in 2017. Numerous other countries have long-established practices for securing lower prices from drug companies. The chart below compares the drug prices negotiated by Medicare with drug prices in 11 other OECD nations of similar size and wealth. Medicare’s new negotiated prices for these 10 drugs are on average 22% lower than current net prices in Part D, Medicare will continue to pay higher prices than peer nations do for the same drugs once these prices take effect in 2026. Drug prices negotiated by Medicare In all but one instance (the price of Stelara
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