November 3, 2021
Democrats release compromise on drug pricing deal aimed for inclusion in Build Back Better Act
On November 2, Congressional leaders announced Democrats reached a bicameral agreement on drug pricing provisions aimed for inclusion in the Build Back Better Act, the $1.75 trillion tax and spending plan that forms the biggest part of President Joe Biden's legislative agenda. In a press release, Energy and Commerce Committee Chairman Frank Pallone (D-NJ) heralded the agreement stating, "We have reached a bicameral agreement to lower prescription drug costs for Americans. This deal will finally allow Medicare to negotiate lower prescription drug prices, penalize pharmaceutical companies that unfairly raise prices, and cap annual out-of-pocket prescription drug costs for seniors at $2,000."
With the drug pricing compromise in place, House Speaker Nancy Pelosi (D-CA) said the spending bill is "just about finished," and intends to get the bill on the floor for a vote later this week, along with the smaller $550 billion bipartisan infrastructure bill that has been passed out of the Senate. Arizona Democratic Senator Kyrsten Sinema (D-AZ), a key vote in the 50-50 Senate, said she agrees on the proposed plan. On Monday (November 1), however, Senator Joe Manchin (D-WV) refused to endorse the bill's framework at this time and demanded more time to evaluate its projected impact, a sentiment that was later echoed by several House moderates who asked to see the full Congressional Budget Office (CBO) score before voting on the bill. Budget Committee Chairman John Yarmuth (D-KY) said a CBO score would likely take two weeks.
According to a draft framework released earlier in the day, the proposal will include three main provisions:
The proposal also includes special rules for small biotech companies, including exempting them from negotiation for the first three years (until 2028); exempting drugs that contribute less than $200 million in Medicare spending; phasing-in reductions from negotiations; and phasing in liability in Part D redesign for six years.