FDA chief hints at changes to drug rebates.

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Just days ahead of the rollout of President Trump’s anticipated drug pricing initiative, the head of the FDA suggested officials might take another look at the legal status of rebates paid by drug companies to insurers and pharmacy benefit managers.

In a speech on Thursday, FDA commissioner Scott Gottlieb said if the federal anti-kickback law that protects such rebates were changed, it could help increase competition and make drugs more affordable.

“One of the dynamics I’ve talked about before that’s driving higher and higher list prices is the system of rebates between payers and manufacturers,” Gottlieb said. “And so what if we took on this system directly, by having the federal government reexamine the current safe harbor for drug rebates?”

Policy hints: Gottlieb discussed some of what the new drug pricing initiative will look like, but didn’t go into much detail. Some hints:

  • One piece involves HHS Secretary Alex Azar making a series of changes to “the pricing mechanisms” of Medicare Part D.
  • Stopping brand-name drug companies from gaming the system in order to keep generic competition off the market.

A warning to drug companies: “I can tell you that the framework … will dismantle many of the provisions that shield parts of the drug industry from more vigorous competition,” Gottlieb said.

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