COMPLIANCE CORNER WITH IPA
Federal Drug Pricing Reform:
What Providers Should Know
President Trump’s State of the Union address featured his Most Favored Nation (MFN) drug pricing initiative as a central component of his healthcare affordability agenda. The President framed MFN as a signature achievement that would move U.S. prescription drug prices from the “highest in the world” to the “lowest,” asserting that the policy has already been enacted through negotiated agreements with pharmaceutical manufacturers.
He cited claimed price reductions of 300 to 600 percent, highlighted anecdotal patient savings through the TrumpRx.gov website, and explicitly called on Congress to codify the program into law to ensure its durability beyond his Administration.
The Push to Codify MFN Pricing
The Administration has inked deals with 16 major pharmaceutical manufacturers, impacting pricing to the Medicaid program, future product launches, as well as domestic investments and avoidance of tariffs.
The agreements are confidential but reportedly last for three years. He continues to push Congress to “codify” most favored nation pricing. This month, Representative Dan Meuser, an off committee Republican from Pennsylvania, introduced MFN legislation.
CMS Updates: Introducing the GLOBE and GUARD Models
Meanwhile, the Centers for Medicare & Medicaid Services Innovation Center (CMMI) has proposed two new drug pricing models that impose rebates to reflect lower, international pricing benchmarks:
The GLOBE Model: Tests international reference pricing in Medicare Part B. It assesses a rebate for certain drugs if prices exceed those paid in economically comparable countries (noting it will not impact ASP or add-on payments).
The GUARD Model: Tests international reference drug pricing benchmarks in Medicare Part D.
Key Highlights of Both Models:
Manufacturer Participation: Model participants will be the manufacturers of the specific drugs included in the different models.
Randomized Beneficiaries: 25% of Medicare enrollees in Part B or Part D across geographic areas will be randomly selected as beneficiaries.
Calculations Waived: Similar waivers are proposed for both models to waive the current Inflation Rebate calculation and replace it with the alternative GLOBE and GUARD international benchmark calculations.
Looking Ahead: IPA’s Stance and Support
IPA shares concerns that importing pharmaceutical price controls could reduce incentives for innovation and weaken the United States’ leadership in the biopharmaceutical sector.
Instead, IPA supports alternative policy initiatives aimed at addressing costs while maintaining a strong innovation ecosystem, including:
More efficient pathways for biosimilar approval and reimbursement
Insurance design reforms that reduce patients’ out-of-pocket costs
Site-neutral policies that encourage competition and deter provider consolidation
IIS and IPA remain committed to keeping members informed on policy changes that may impact reimbursement, access, and the future of infusion care. Through our partnership with IPA, we are dedicated to providing members with timely regulatory insight and practical guidance to help navigate an increasingly complex healthcare landscape.