Biden brings plan for prescription drug pricing reform to Congress

That is the title of an article published in Pharmaceutical Technology today. I am quoted extensively. For instance, President Biden proposes to cap drug prices at genera rates of inflation. The article highlights some limits this would pose to value-based pricing that could evolve over time:

Shafrin also says while Biden’s plan to penalise companies that increase drug prices may sound like a good idea, it “removes flexibility” when it comes to pricing drugs based on how valuable they are.

“For instance, some researchers have called for the use of a three-part pricing model whereby drugs with uncertain efficacy – for example, perhaps due to use of surrogate trial endpoints – start with a relatively low price,” he explains.?“If real-world evidence of subsequent clinical trials show that the drug is in fact very effective, the price would rise.?Once the drug loses its exclusivity period and generics enter, the price would fall again.

“However, these types of creative pricing arrangements linking price to evolving evidence on value would be effectively stymied by the Biden administration’s proposed price controls.”

Do read the entire article here.

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