Drugmakers reluctantly agree to Medicare drug price negotiations, as lawsuits continue
Merck, AstraZeneca, Bristol Myers Squibb and Boehringer Ingelheim have signed agreements to participate in the first round of Medicare drug price negotiations, while the remaining drugmakers have until Oct. 1 to decide.
Four large pharmaceutical manufacturers, despite ongoing legal challenges, have agreed to participate in Medicare price talks ahead of the Oct. 1 deadline to notify the Centers for Medicare & Medicaid Services.
Although participation in the negotiation program is voluntary, companies that don’t participate have to pay a major excise tax or withdraw entirely from the Medicare and Medicaid programs. At least nine different lawsuits have been filed over the negotiations and the law, including suits by several companies whose drugs are in the first list of 10, arguing that it’s unconstitutional.
These companies have announced their intention to participate:
- Boehringer Ingelheim (Jardiance for type 2 diabetes): Although Eli Lilly and Boehringer Ingelheim jointly developed Jardiance through an alliance that dates back to 2011, Lilly said Boehringer Ingelheim “has sole responsibility for pricing, reimbursement and access to Jardiance,” and Lilly will not have any role in the price set by CMS. “We are committed to engaging in open and transparent conversations with CMS,” the company told Endpoints News. “We look forward to sharing detailed information with CMS on the value of Jardiance and to reinforce the need to invest in scientific medical innovation for the patients we serve.”
- Bristol Myers Squibb (Eliquis, a blood thinner): “We have no choice other than to sign the ‘agreement,’” the company said. “If we did not sign, we’d be required to pay impossibly high penalties unless we withdraw all of our medicines from Medicare and Medicaid. That is not a real choice.”
- AstraZeneca (Farxiga for type 2 diabetes): “We remain committed to ensuring patients have access to Farxiga and plan to participate in the process outlined by CMS to communicate the value of Farxiga to people covered by Medicare,” the company said.
- Merck (Januvia for type 2 diabetes): The drugmaker will sign the agreement to participate “under protest,” noting that it disagrees on “both legal and policy grounds” with the negotiations. But “withdrawing all of the company’s products from Medicare and Medicaid would have devastating consequences for the millions of Americans who rely on our innovative medicines, and it is not tenable for any manufacturer to abandon nearly half of the U.S. prescription drug market,” a spokesperson said.
Related: First 10 drugs set for Medicare price negotiations: Will pharma participate?
The other manufacturers selected for the first round of negotiations – Amgen, Johnson & Johnson, Novartis and Novo Nordisk – have not yet announced their intentions regarding the deadlines.
“We will explore all options that allow us to drive change for people that need it and strive to continue to bring innovative medicines to the market while helping increase access for those that need them,” said a spokesperson for Novo Nordisk, which manufactures Ozempic and NovoLog for diabetes. “Given that our products have been included in CMS’ list, we will be determining next steps toward addressing those important initiatives.”
CMS will send an initial price offer for each selected drug for the maximum fair price and a concise justification no later than Feb. 1, 2024, and companies will have 30 days to respond.