Biden Administration Releases Drug Rebate List, Promotes End of Vaccine Cost Sharing

The Biden administration Wednesday released the list of 27 Medicare Part B drugs that are subject to rebates back to the government as allowed under the Inflation Reduction Act (IRA) for having price increases that rose faster than inflation.

In addition, the administration touted a part of the law that removed cost sharing for vaccines for Medicare beneficiaries, saying that if the policy had been in place in 2021, 3.4 million individuals receiving vaccines under Part D would have saved $70 per beneficiary.

The list of Part B drugs includes the chimeric antigen receptor (CAR) T-cell therapy axicabtagene ciloleucel, sold as Yescarta; the CAR T-cell therapy brexucabtagene autoleucel, sold as Tecartus; the brand-name biologic adalimumab, sold as Humira; and the ophthalmologic drug triamcinolone acetonide injectable suspension, sold as Xipere.

Rebates for 2023 and 2024, which will go back into the Medicare Trust Fund, will not be invoiced to pharma manufacturers until 2025.

Beneficiaries in traditional fee-for-service Medicare as well as Medicare Advantage may see a difference in what they pay as soon as next month, depending on the dose of the Part B drug as well as how often it is administered, HHS and CMS officials said Tuesday. They estimated that the out-of-pocket cost reduction could range from $2 to as high as $390 per average dose.

The administrating is hoping that by being compelled to send rebates back to the government, drug companies will be incentivized to keep any price increases below the level of inflation. Companies failing to pay the rebate will face a penalty equaling 125% of the rebate amount.

President Joe Biden is scheduled to talk about drug pricing in a speech Wednesday in Las Vegas.

In its report about vaccines, HHS said that about 51 million Medicare beneficiaries are enrolled in a Part D plan. Looking at vaccine coverage under Part D, including ones to prevent herpes zoster (shingles); tetanus and diphtheria (Td); tetanus, diphtheria, and pertussis (Tdap); hepatitis A; and hepatitis B, HHS said only 7% of enrollees received a covered vaccine. Total OOP costs were $234 million in 2021.

Most of the beneficiaries received the shingles vaccine (82%), with each patient paying an average of $77 in OOP costs, followed by the Tdap vaccine (21%), with an average of $28 in OOP costs.