President Trump Releases Innovation Stifling “Most-Favored Nation” Rule
The Trump Administration released two pre-Thanksgiving regulatory actions on the so-called “Most-Favored Nation” and the Part D rebate rule. Both actions were among the executive orders on drug pricing President Trump had announced earlier this summer.
The Most-Favored Nation model was unveiled as an interim final rule with a 60-day comment period and would “test” a payment model for certain Part B treatments based on the lowest adjusted price from 22 Organization for Economic Co-Operation and Development (OECD). The model would test 50 sole-source drugs and biologics in care settings accounting for an estimated 88 percent of total Part B spending on the 50 treatments. The seven-year demonstration project would phase in the MFN price over the first four years of the model with years five to seven continuing at 100 percent of the MFN price. The model would also replace the existing ASP+6 model for providers with a flat, per-dose add-on fee.
BioNJ continues to believe this reckless policy proposal would hurt both innovators and the Patients we serve. And apparently the administration agrees with this assessment, estimating that nearly 20 percent of model savings would come directly from lower Patient utilization of necessary treatments.
The Trump Administration has also released its rebate rule that was previously withdrawn in July of 2019. The rebate rule would eliminate existing Part D rebate safe harbors while creating new safe harbors for point-of-sale price reductions. BioNJ had previously noted our support of this proposal to help improve Patient access to lifesaving treatments.
A link to the CMS Innovation Center press release announcing the MFN model that includes a fact sheet and a link to the rule itself is available here. Click here for BioNJ President and CEO Debbie Hart’s statement on this announcement.
A copy of the rebate rule is available here and a HHS press release is available here.
