The Biden administration said on Thursday it had identified 48 drugs in the Medicare program whose prices rose quicker than inflation during the fourth quarter of the year and may require their makers to pay rebates.
President Joe Biden’s signature Inflation Reduction Act (IRA) includes a provision to penalize drugmakers who work with Medicare, a government program for people aged 65 and older or who are disabled.
The 48 drugs it identified fall under Medicare Part B, which covers treatments administered at a health facility.
Medicare recipients could benefit by a reduction in their co-insurance payment for any of the drugs by $1 to $2,786 per average dose, according to a government statement.
The president, in remarks at the National Institutes of Health, said big pharmaceutical companies, in the year before the law was passed, “jacked up” prices nearly four times faster than inflation went up.
“They’re ripping off Medicare. They’re ripping off the American people,” Biden said. “We’re going to save taxpayers money and discourage companies from raising prices in the first place.”
The White House is eager to emphasize the benefits of the IRA in bringing drug prices down ahead of the 2024 election, when Biden, 81, is running for a second term.
In total, prices of 64 drugs increased faster than inflation over the last four quarters, the White House said in a statement.
The IRA aims to save $25 billion annually by 2031 by requiring drugmakers to negotiate the prices of selected expensive drugs with the U.S. Centers for Medicare and Medicaid Service, which oversees Medicare.
The Biden administration last week announced it would create guidelines for when and how it could seize patents for medicines developed with government funding, including considering when their prices are too high.