Medicare Drug Price Negotiation: Extending Delay for Biosimilar Competition.
This bill changes Medicare drug price negotiation rules by extending the period during which original biological drugs are shielded from negotiation if a cheaper biosimilar version is actively being developed. The goal is to incentivize the faster market entry of biosimilars, potentially lowering prescription costs for Medicare beneficiaries. If the biosimilar fails to launch within the new 2-year window, the original drug manufacturer faces significant financial penalties.
Key points
The delay period for Medicare price negotiations for reference biological products is extended from 1 year to 2 years when a biosimilar is in development.
An automatic negotiation delay is triggered if a biosimilar manufacturer publicly discloses that their product application is accepted, clinical trials are ongoing, or market entry is expected within two years.
Manufacturers who receive the delay but whose biosimilar does not reach the market within the 2-year period must pay substantial financial rebates to the government.
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