Drug prices after Medicare negotiations may be a 'nothing burger' for Big Pharma
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DRUG PRICES AFTER MEDICARE NEGOTIATIONS MAY BE A 'NOTHING BURGER" FOR BIG PHARMA
Wall Street analysts and drugmakers appear at ease ahead of the U.S. government's release of the final prices of its first ever negotiation over prescription drugs as they expect the hit to sales to be less than originally feared.
BMO Capital analysts say the drug pricing release, expected in the next few days, could be "An August Nothing Burger for BioPharma in the Making".
"We expect the impacts of the IRA across the first round of negotiated drugs to be muted," said BMO analysts, referring to U.S. President Joe Biden's Inflation Reduction Act that includes the drug price provisions.
Four drugmakers - Bristol Myers Squibb, Johnson & Johnson, AbbVie, and AstraZeneca AZN.L - which have five of the 10 drugs chosen for the first wave of negotiations, had said last month they do not expect a significant impact on their businesses after seeing confidential suggested prices from the government for their drugs.
J.P.Morgan analysts say a "more manageable than feared Eliquis price cut in 2026" could start to bring Bristol Myers investors "back to the story".
Medicare is expected to announce cuts to list prices of at least 25% by Sept. 1, and the final prices will take effect in 2026.
Under President Joe Biden's Inflation Reduction Act (IRA), signed into law in 2022, the Medicare agency was required to identify the 100 most expensive drugs in the program and pick 10 for price negotiations that began last year.
(Mariam Sunny)
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U.S. drugmakers part of Medicare drug price negotiation program https://tmsnrt.rs/4cns9t5
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