CBO Analysis Says Azar’s Drug Rebate Rule Won’t Lower Drug Prices

Following Axios’ reporting about the CBO report about the Trump administration’s drug rebate rule that they promised would lower drug prices, Lizzy Price of Restore Public Trust made the following statement:

“Surprise, surprise, the one thing that Secretary Azar has hung his hat on is a total sham. Not only will this drug rebate rule fail to lower prices for American families, but it will actually be a ‘gift’ to pharmaceutical companies. This is what happens when you appoint a pharma insider to lead HHS – handouts to the pharmaceutical companies while families continue to struggle.”

ICYMI: AXIOS: Another drag on the drug rebate rule

A new analysis from the Congressional Budget Office reiterates the major concerns about the Trump administration’s drug rebate rule — that it could be a budget-buster and a gift to pharmaceutical companies, Bob writes.

By the numbers: CBO estimates the regulation would raise federal spending by $177 billion over the next decade because health insurers and pharmacy benefit managers would raise premiums to offset the loss of rebates — similar to what actuaries at the Centers for Medicare & Medicaid Services have projected.

• CBO also believes drug manufacturers “would not lower their list prices” and “would withhold about 15%” of what they currently rebate to PBMs for themselves.

The bottom line: The CBO is yet another non-industry party — following comments from the likes of MedPAC, Pew and academic researchers — saying the rebate rule will cost taxpayers more money but will not guarantee lower drug prices.