A Monday off is always a double win, longer weekend and shorter week.
Caught My Eye
Made me Laugh. 340B can be funny. Go PhRMA.
Zebras, Not Unicorns. The Food and Drug Administration announced a new rare disease approval framework. While it acknowledges the challenge of rare disease, it is unclear if the new framework does anything to improve the approval process for these drugs. It could be the back-to-school night/high school flashbacks but it feels like the cute boy in class making eye contact, sure it is nice, but it doesn’t mean he likes you.
Mind the Gap. A little Medigap primer anyone?
Combative. RFK Jr. testified in front of the Senate Finance Committee and he was spicy towards the senators. In terms of content, it went about how you’d expect (vaccines access has been comprised, no it hasn’t, yes it has). It was pretty gross. Access to vaccines has been altered by decisions made by RFK Jr. – to say otherwise is dishonest. I disagree with the decisions but lying about them makes it so much worse. If you believe in something enough to make the big changes, own up to it. This is why I’m not political, I get it.
Beyond the noise, there was a moment when RFK Jr. seemed confused about Medicare Part D and how it worked and what was being done for seniors. NYT (gift link) has overall hearing the play by play.
Ready to Rumble? Toolkits are in play to get pharmacies ready and enrolled for January’s 2026 implementation of Medicare negotiated prices. Pharmacies need to join in order o get access to the Medicare Transaction Facilitator which will enable pharmacies to get paid back by manufacturers for the 10 negotiated drugs. Tens of thousands of pharmacies. If you’re thinking there was an easier way, you’d be right.
Reviewing the Fundamentals – Generics are our Secret Sauce
I know there is so much said about high prescription drug prices, but we seldom talk about the win on the other side – when a drug goes generic.
While the U.S. is frequently criticized for its high brand-name drug costs, we have remarkably low prices for generic medications. A 2022 report by the RAND Corporation found that while U.S. brand-name drug prices were more than four times higher than in other comparable countries, prices for unbranded generic drugs were about 67 percent of the average cost in those same nations. Pay more now, savings later.
The foundation for the U.S.’s generic drug market was laid by the Drug Price Competition and Patent Term Restoration Act of 1984 or, as the cool kids say, Hatch-Waxman. Before this legislation, generic manufacturers were forced to undergo the same extensive and costly clinical trials as brand-name companies, creating a significant barrier to entry. Hatch-Waxman changed the game. It created an abbreviated approval process where manufacturers just had to demonstrate that their product was “bioequivalent” to the original. So today we have less expensive generics that account for ~90% of all prescriptions filled in the U.S., creating a high-volume market competing on price. That has its own problems with supply chain issues, but today we’re celebrating the win.
In Europe, health systems often use reference pricing to control drug costs. While reference pricing is effective at pressuring brand-name companies to lower their prices, it can have an unintended side effect on generic prices. Because the government sets a fixed reimbursement price, generic manufacturers have less incentive to compete on price below that floor. If they drop their price too low, their profit margins can be squeezed to a point where it is no longer viable to produce the drug, particularly in smaller markets. This can lead to a less intense price-driven competition among generic manufacturers than is seen in the U.S.
Game. Set. Match – U.S., at least on generics.
