STAT+: Trump administration revisits policy to close Medicare drug price negotiation loophole

The Trump administration proposed a policy change on Friday aimed at preventing drugmakers from circumventing Medicare price negotiations by adding active ingredients to existing drugs. This proposal is part of the annual rule-making process for the Centers for Medicare and Medicaid Services (CMS) to select the next 20 drugs and biologics for price negotiation. The chosen drugs will be announced by February 1, 2027, with their negotiated prices becoming effective in 2029. The administration had previously considered a similar policy last year but postponed a decision to conduct further study. Under current Medicare regulations, price negotiation for a product can only begin seven to eleven years after its approval by the Food and Drug Administration (FDA), with biologics administered in doctor's offices receiving a longer negotiation window than orally taken drugs. This policy adjustment seeks to close a loophole that allows pharmaceutical companies to extend market exclusivity and delay price reductions for Medicare beneficiaries.