Under the Inflation Reduction Act, Medicare is poised to send initial offers to manufacturers of the first ten drugs chosen for negotiation, challenging the established prices set by pharmaceutical companies.
This historic initiative aims to alleviate the financial burden on seniors, who, in 2022, spent an estimated $3.4 billion out-of-pocket for these crucial medications.
The program directly confronts the prevailing trend where drug prices in the U.S. are two to three times higher than in comparable OECD countries.
A newly released report exposes Big Pharma's pricing practices, revealing that Americans were charged two to three times more for the same drugs than individuals in other OECD nations in 2022.
Despite nearly $750 billion spent on self-enriching stock buybacks and dividends by large drug companies over the last decade, drug prices in the U.S. remained disproportionately high.
In 2023, the pharmaceutical industry engaged in mergers and acquisitions totaling over $135 billion, transferring the financial burden to consumers.
Additionally, six out of ten drugs included in the negotiation program for the current year increased their prices in the first month of 2024 despite already being priced three to eight times higher in the U.S. compared to other nations, the White House said in a statement.
The negotiation program is set to expand, with up to 60 drugs selected for negotiation over the next four years.
The White House said that millions of senior citizens with diabetes are experiencing positive outcomes from the President's Inflation Reduction Act, particularly through the $35 cap for a monthly supply of insulin.
Additionally, 15 million Americans are enjoying annual savings of $800 on health insurance premiums. Seniors using the 47 drugs covered by Medicare Part B, which saw price increases exceeding inflation in 2023, are benefiting from lower coinsurance, with potential savings of up to $618 per dose for some enrollees.