Most significantly, in August 2022, President Biden signed the Inflation Reduction Act of 2022, or IRA, into law. This statute marks the most significant action by Congress with respect to the pharmaceutical industry since adoption of the ACA in 2010. Among other things, the IRA requires manufacturers of certain drugs to engage in price negotiations with Medicare, with prices that can be negotiated subject to a cap; imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation; redesigns the Medicare Part D benefit and replaces the Part D coverage gap discount program with a new manufacturer discount program. Under an annual process, CMS has negotiated prices for ten drugs whose new prices began in 2026 and for another 15 drugs whose new prices will be effective in 2027.
