Drug Pricing

The cornerstone of a well-functioning market is competition. President Biden’s Executive Order 14036, “Promoting Competition in the American Economy” identified a lack of competition as a key driver for problems across economic sectors.

Drug manufacturers may change the list prices of their drugs at any time after launch. Over the period from January 2022 to January 2023, more than 4,200 drug products had price increases, of which 46 percent were larger than the rate of inflation. The average drug price increase over the course of the period was 15.2 percent, which translates to $590 per drug product.

The Inflation Reduction Act (IRA) is helping people with Medicare afford their medications, including the 2.1 million Asian, 5.8 million Black, and 5.3 million Latino Part D enrollees. These fact sheets review existing research to present the projected impacts of key IRA Medicare drug-related provisions for these populations.

The Inflation Reduction Act (IRA) authorizes the Secretary of the Department of Health and Human Services (HHS) to negotiate prices directly with participating manufacturers for selected drugs that are high expenditure, single source drugs without generic or biosimilar competition.

The market for antimicrobial (AM) drugs is unique in that it is associated with a positive externality (public health) as well as a negative externality (antimicrobial resistance, or AMR) (Mossialos, et al., 2010). AMR occurs when microbes change over time and no longer respond to available medicine.

Introduction

Expanding access to high-quality, affordable health care has been a priority of the Biden-Harris Administration.

The U.S. Department of Health and Human Services (HHS), Office of the Assistant Secretary for Planning and Evaluation (ASPE) released new research on spending and utilization trends of Medicare Part B drugs, drugs administered in physicians' office or hospital outpatient departments rather than being purchased at the pharmacy counter or by mail order.

Prescription drug shortages are an ongoing concern in the United States (U.S.). While prior analyses explore the frequency of drug shortages in the U.S., little is known about the extent to which U.S. shortages impact consumer costs and healthcare systems. Drug shortages impact consumer costs in various ways.

Effective January 1, 2023, the Inflation Reduction Act (IRA) eliminated enrollee cost-sharing for recommended vaccines covered under Medicare Part D. In 2021, 3.4 million people received vaccines under Part D, and annual out-of-pocket costs were $234 million.