Biden’s Drug Price Plan Still Flawed Under Trump, Opponents Say

The pharmaceutical industry is criticizing the Trump administration’s plan for carrying out a critical round of Biden-era drug price negotiations that doubles down on actions they’ve resisted since the program began.

The pushback was revealed in comments in response to the Centers for Medicare & Medicaid Services’ draft guidance for the third cycle of the drug price negotiation program. The plan negotiates Medicare-covered drug prices with manufacturers each year, with the agency now preparing for the third round of talks slated to begin in 2026 and target 15 additional drugs.

The industry has long criticized the government’s implementation of the program, finding flaws in how medicines are picked and how the negotiated drug price is determined. The fight appears poised to continue after the latest feedback to the Trump administration’s takeover of the program raised similar complaints as those during former President Joe Biden’s implementation.

“CMS doubled down on the previous administration’s flawed approach,” the Pharmaceutical Research and Manufacturers of America, the drug industry’s top lobbying group, said in a statement. The guidance fails to address the “real pain points” patients face in accessing their medicines and erodes incentives for developing the next generation of medicines, the group said.

This guidance matters as it signals how the Trump administration will run the program. Pharmaceutical giants have been working to encourage President Donald Trump to fix or pause the plan, but they’ve so far encountered an administration that supports the negotiations and issued various executive orders targeting US drug prices. The administration plans to finalize the third cycle’s guidance by early fall.

The guidance is also significant because it introduces new program developments—the negotiation of Part B drugs, plans for reviewing fixed combination products, and renegotiations.

“The third cycle is very precedential,” said Kristi Martin, former CMS chief of staff for Medicare and senior adviser in the Biden administration.

“Not only do you have big policy and operational pieces to think through, but you also have ideological shifts that could happen as well,” said Martin, now a director at Camber Collective.

Medicare Part B

Among the industry’s concerns is the government’s plan for bringing Part B into the program—a significant move as the Medicare plan covers treatments typically administered in a doctor’s office and includes different pricing dynamics and stakeholders in the supply chain.

“One of the key differences between Part D products and Part B products is the reimbursement,” said Meenakshi Datta, co-leader of Sidley LLP’s health care practice. “It’s going to impact provider reimbursement as well and provider economics, which is going to be disruptive to the marketplace.”

Groups were skeptical about the agency’s lack of details, raising doubt over how Part B providers will need to acquire, administer, and reimburse drugs under the program.

PhRMA and the Biotechnology Innovation Organization shared concerns about the oversight of Part B drugs in Medicare Advantage plans, spillover effects into the commercial market, and access barriers that Part B beneficiaries face.

The Community Oncology Alliance said the “Part B effectuation process has the potential to be a practice-ending event for many community oncology practices,” and that centers need time to plan for cash flow and pricing implementation plans.

At the same time, the National Pharmaceutical Council, a health policy research organization, called on the CMS to provide greater clarity on how it will consider Part B treatments as additional preventive services.

Groups that are in full support of the negotiation program have also shared uncertainty about how the agency will implement Part B into the program.

“While we are pleased to see the inclusion of Part B drugs, we have concerns that under the current draft guidance CMS would not be using all of the applicable expenditure data available to calculate drug expenditures for negotiation eligibility,” said Merith Basey, executive director of Patients for Affordable Drugs Now.

Drug Selection

Comments also took issue with how the Trump administration will select medicines for the program, a critical decision that considers whether a drug’s active moieties or active ingredients make it a distinct product under negotiations.

Previous guidance said a “fixed combination drug” containing two or more active moieties or active ingredients will be considered distinct from a product that contains only one of those active moieties or ingredients.

In the latest guidance, the agency added that “there may exist fixed combination drugs for which one of the active ingredients or active moieties contained is not biologically active against the disease state(s) the drug is indicated for and thus does not result in a clinically meaningful difference.”

That additional detail shook the industry because it indicates the government may exercise more discretion to fixed combination drugs.

PhRMA called the move a “misguided approach” that groups fixed-dose combinations together with separately approved drugs with one active ingredient. BIO shared similar concerns and said “there is no statutory basis for CMS’ proposed approach.”

Renegotiation

The industry also raised uncertainty about the agency’s discretion for drugs eligible for renegotiation and what framework it will use to determine prices.

The concern is spurred by previous industry pushback that questioned the government’s explanations for selecting medicines and determining their negotiated drug price in the program’s first cycle.

“We are concerned that given the limited details on renegotiation, manufacturers will have administrative burden to complete the timeline for renegotiation,” the National Pharmaceutical Council said.

The details matter as drugmakers will now need to prepare for various negotiation cycles, drug pricing experts say.

“The guidance definitely needs to think about what other pathways or opportunities you can have to make the renegotiation selection more robust and to include multiple perspectives,” Martin said. “If they really want transparency and engagement, they need to be considering how the public can help contribute to that process too.”