The Centers for Medicare & Medicaid Services (CMS) released a proposed rule, titled Medicare and Medicaid Programs: Drug Pricing Transparency, which would require direct-to-consumer advertisements for prescription drugs covered by Medicare or Medicaid costing at least $35 a month to include the Wholesale Acquisition Cost (WAC) (referred to as the “list price”).
Specifically, the proposed rule would require that advertisements for certain prescription drugs or biological products on television (including broadcast, cable, streaming, and satellite), must contain a statement or statements about the “list price” for a standard 30-day regimen or typical course of treatment, whichever is most appropriate. The rule applies to drugs and biological products distributed in the United States for which payment is available, directly or indirectly. “This historic proposal is an important way to create new incentives for drug companies to start lowering their list prices, rather than raising them. Patients deserve to know what a given drug will cost when they’re being told about the benefits and risks it may have, and they deserve to know when a drug company has pushed its prices to abusive levels, and they deserve to know this every time they see a drug advertised to them on TV,” Department of Health and Human Services (HHS) Secretary Alex Azar said during a speech in Washington, D.C.
It is important to note that what consumers pay for their drug is the “list price,” or negotiated lower price, minus discounts, rebates or insurance payments. Understanding that the “list price” set by the pharmaceutical companies is typically much higher than what a consumer pays, the rule was amended to allow advertisements to state that if consumers have health insurance that covers drugs, their cost may be different.
This rule is another initiative with the goal of reducing prescription drug spending for government programs as well as patients. Visit HERE to read more on other such initiatives. GIRS is tracking the proposed rule and will report on the final rule when it is published.
The proposal will be open for public comment until December 17, 2018. Comments may be submitted electronically through: https://www.cms.gov/Regulations-and-Guidance/Regulations-and-Policies/eRulemaking/index.html?redirect=/eRulemaking
If you would like to position your products for market uptake as a result of optimal access by patients and providers and improved coverage by payers based on their value, and if you would like to craft different value propositions for the different stakeholders, the GIRS Value Discovery Landscape Assessment® team can assist you to meet your company goals.
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Sources:
Proposed Rule