Publication | BRG
Inflation Reduction Act Drug-Pricing Provisions: Financial Impact on Manufacturers
Ellie Blalock, Clay Willis, Austin Hay, Susanna Leaf, and Josh Galuska
Earlier this year, we discussed how it is time for manufacturers to assess the financial impact that each drug-pricing provision in the Inflation Reduction Act (IRA) may have on their drug portfolios or upcoming product launches. This included various approaches for how manufacturers could proactively evaluate the impact of the IRA’s drug-pricing provisions to better inform business strategies, project their financial performance, and even mitigate financial consequences.
In this supplement, we evaluate scenarios within the drug-pricing provisions to demonstrate potential financial impact on manufacturers. First, we discuss the projected $22 billion increase in Part D discounts that manufacturers will face in 2025 driven by the Part D benefit redesign. Second, we discuss the Medicare price negotiation and how its impact on best price can spill over to Medicaid and the 340B Drug Discount Program (“340B program”). Finally, we will discuss the Part B and Part D inflation rebates and how they could impact pricing strategies.