ATR Urges CMS to Withdraw Proposed Rule on Medicare Drug Price Control Program

Today, Americans for Tax Reform filed comments opposing the Centers for Medicare & Medicaid Services’ proposed rule, “Medicare Drug Price Negotiation Program (DPNP) and Medicare Prescription Drug Benefit Program” (CMS-4215-P).

This proposed rule would convert three years of program guidance into permanent, binding regulation, locking in a price control regime – created under the Biden administration – that will be far harder to revise once its devastating effects on drug development become clear.

In its comments, ATR urges CMS to withdraw this rule, or, at minimum, substantially narrow the authority it claims for itself in several of the provisions in the proposed rule.

The Inflation Reduction Act (IRA), passed without a single Republican vote and signed by President Biden, authorized the HHS Secretary to “negotiate” Medicare drug prices. In practice, the Secretary can simply set a price and tax any company that charges more up to 95 percent of their sales. The program covers 10 drugs in 2026, rising to 60 by 2029 and expanding by 20 drugs every year thereafter.

Codifying this program into permanent regulation lends legitimacy to a price control scheme that is a “negotiation” in name only. It will chill innovation, shift costs rather than reduce them, and foreclose the agency’s ability to course-correct once those effects become clear. Further, ATR’s comments note four specific provisions of concern: the fixed combination drug proposal, the Bona Fide Marketing determination, the orphan drug exclusion period, and the absence of administrative or judicial review.

To read ATR’s comments in full, click here or see below.