Weekly Policy Update: Biden Administration Releases Drug Pricing Plan

The Biden Administration through the Department of Health and Human Services (HHS) published a white paper detailing multiple policy strategies to address prescription drug costs, the paper is in response to an executive order issued by the President this past summer. The paper discusses policies that require a combination of administrative actions HHS can pursue on their own along with legislative actions that still need to pass through Congress. Additionally, these combined policy actions will not exclusively impact Medicare parts B and D, but all purchasers of medicines.  

CBSA remains committed to advancing affordability solutions that correct market failures, increase competition, and lower costs for patients. The Administration’s current approach coupled with ongoing legislative efforts like H.R. 3 will have an undeniable crippling effect on Colorado’s growing life sciences ecosystem. The Department’s full 29-page report to the White House Competition Council can be found here, with key policies highlighted below.  


  • Testing models using value-based payments in Medicare Part B, in which payment for drugs is directly linked to the clinical value they provide patients  
  • Testing models providing additional cost-sharing support to Medicare Part D Low-income Subsidy Beneficiaries for using biosimilars and generics   
  • Testing total cost of care models in Medicare to determine whether they produce changes in drug utilization, reductions in total spending, and improvements in patient outcomes   
  • Data collection from insurers and Pharmacy Benefit Managers (PBMs) to improve transparency about prices, rebates, and out-of-pocket spending on prescription medications   
  • Continuing to implement the Food and Drug Administration’s Biosimilars Action Plan and Drug Competition Action Plan, and clarifying the approval framework for generic drugs to encourage a more transparent and efficient process   
  • Work with states and Indian Tribes to develop drug importation programs that reduce costs to consumers without increasing risks to safety  


  • Drug price negotiation in Medicare Parts B and D, with those negotiated prices also available to commercial plans (including the Marketplace) and employers who want to participate   
  • Medicare Part D reform, including a cap on catastrophic spending to protect beneficiaries from unaffordable out-of-pocket costs   
  • Legislation to slow price increases overtime on existing drugs   
  • Legislation to speed the entry of biosimilar and generic drugs, including shortening the period of exclusivity, and policies in Medicare Part B to increase the prescribing of biosimilars by clinicians   
  • Prohibition on “pay-for-delay” agreements and other anti-competitive practices by drug manufacturers   
  • Investment in basic and translational research to foster innovation, including President Biden’s proposal to create the Advanced Research Projects Agency for Health (ARPA-H)  

PhRMA C.E.O Steve Ubl was quoted in the New York Times calling the policy “an existential risk to the industry”. He continued by noting “Major across-the-board price reductions would result in reduced revenues for drug companies and could hurt companies’ ability to spend on research as well as cause smaller companies to close if investors leave the sector”

CBSA along with our partners at BIO and PhRMA will continue to monitor and engage with policymakers on these sweeping federal proposals that would allow government price-setting of medicines. CBSA works to protect timely patient access to needed therapies and technologies. The association supports reimbursement policies that facilitate patient access to the right therapy or treatment at the right time, including appropriate and inclusive coverage, coding, and payment for biopharmaceutical, medical device, and diagnostic products. 

Categories: CBSA News