If you watched Chris Hayes’s show on MSNBC last night, you’d have seen a brief montage featuring every Democratic presidential nominee from Bill Clinton on saying they would bring down prescription drug prices by allowing Medicare to negotiate prices with pharmaceutical companies. And voila, yesterday, the Biden administration announced the first 10 drugs whose prices will be negotiated, thanks to the passage of last year’s Inflation Reduction Act, which just celebrated its first birthday. What a talented baby!
And just like that, a longtime plank of Democratic campaign platforms is another step closer to being realized. Pretty damn cool, and of course every single Republican in Congress voted against it.
Also if you watched MSNBC last night, or ever, you probably saw ads for some of the drugs on the list. I’m embarrassed to say I can call to mind the jingles for some of them. For the first round — additional drugs will be added to the list each year going forward — the Centers for Medicare and Medicaid Services (CMS) will negotiate prices for the 10 most expensive drugs for Medicare beneficiaries. The negotiated prices will go into effect in 2026.
I’m just gonna borrow NBC News’s list of the drugs and what they do. You’ll have to look up the jingles yourself.
Eliquis, a blood thinner
Xarelto, a blood thinner
Januvia, a diabetes drug
Jardiance, a diabetes drug
Enbrel, a rheumatoid arthritis drug
Imbruvica, a drug for blood cancers
Farxiga, a drug for diabetes, heart failure and chronic kidney disease
Entresto, a heart failure drug
Stelara, a drug for psoriasis and Crohn's disease
Fiasp and NovoLog, for diabetes
According to CMS, these 10 medications together accounted for 20 percent of Medicare Part D spending, a whopping $50.5 billion, from June 1, 2022, through May 31 of this year.
And now they’ll be FREE. Oh, excuse me, the revolution has not arrived, nor has plain old universal healthcare like sane countries have. Rather, starting in 2026 they’ll cost less because CMS will negotiate the price with the pharma companies, who are already crying big wet tears about how they will never be able to do research again. This is where I throw in a little factoid from the administration’s fact sheet, pointing out that Big Pharma has
spent more on stock buybacks and dividends than they spent on research and development, even as nearly three in ten Americans struggle to afford their medications because of cost.
It’s worth pointing out here that the reason we’re only now beginning to negotiate prices on prescription drugs is that up until now, the government was explicitly blocked from doing so by the law that created Medicare Part D in the first place. That was basically the price that Big Pharma demanded — through its lobbying of members of Congress, mostly Republicans, but a few Dems too — to even pass Medicare Part D.
And needless to say, the industry is already suing to kill off the price negotiation provisions of the IRA, because oh dear, who will think of the profits research into new drugs, not to mention the stock buybacks.
The Pharma claim that price negotiations will simply ruin innovation and research is mostly an empty talking point anyway, as the New York Times points out. Despite dire predictions by the industry, an analysis of the IRA by the Congressional Budget Office “estimated that the law would result in only one fewer drug approval over a decade and about 13 fewer drugs over the next 30 years.”
And beyond that, wouldn’t you know it, the Times identifies another neat idea built into the IRA that’s likely to nudge drug companies toward developing useful drugs, not simply trying to grab a share of their competitors’ market:
[Many] new drugs “are not offering clinically meaningful benefit over existing drugs,” said Ameet Sarpatwari, an expert in pharmaceutical policy at Harvard Medical School. The Inflation Reduction Act, he said, might incentivize companies to focus more heavily on breakthrough therapies, instead of so-called me-too drugs, because the law requires the government to consider the clinical benefit of medications in determining the price Medicare will pay for them.
Wow. So if pharma companies want a better bang for their R&D buck, they’ll do well to develop drugs that actually advance medicine. That’s in the law.
Gratuitous Editorializing: Details like that just underline that, in general, Democratic legislation focuses on serious policy goals, while as far as we can tell, all Republican legislation since 2010 has focused on trolling. The sole exception, of course, would be tax cuts, which are focused and fine-tuned to a frightening degree.
Anyhoo, this is just the first step toward socialism, because each year going forward, more drugs will be subject to negotiated prices: 15 more in 2027, another 15 in 2028, and then 20 more every year after that until we’re all Reds — unless somewhere in there we turn into France or Norway and actually just have universal coverage and price controls for everything.
Also too, additional IRA health savings are on the way:
Starting next year, Part D enrollees will no longer have to pay the current 5 percent co-insurance when they reach the “catastrophic” level of benefits, because for chrissakes when you’re in catastrophic care you don’t need higher costs on top of everything else.
Beginning in 2025, out-of-pocket costs for Part D enrollees will be capped at $2,000 a year, which will save them about $400 a year. The biggest savings from the new cap will be felt by seniors with the highest drug prices; they should save an average of $2,500 annually.
And remember, insulin costs for Medicare enrollees are already capped at $35 a month. So far, we haven’t quite turned into a commie dictatorship as a result.
This is where I was going to quote some of the idiotic rightwing Usual Suspects decrying negotiating prices as commie Soviet socialist tyranny, but we all know they’re wrong and full of shit so why bother with that again? It’s a nice day and we really need to let people know why Joe Biden needs four more years so we can keep traveling down the road toward the Fully Automated Luxury Gay Space Communism we really want.
[White House / NBC News / NYT / KFF]
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My favorite pharma ad remains the one from a couple years back — don't remember the drug, which is a common problem for these ads — where the voiceover is talking about how unlike other similar drugs, there's no need for regular lab testing.
During that bit, the happy couple onscreen are playing fetch with a yellow lab and a chocolate lab.
While he's at it, Biden could also address climate change and loss of trees by limiting the length of CVS receipts.