Democrats said the senator trimmed Democrats’ plan to curb drug prices, but left it largely unscathed on Saturday, as party leaders prepare to begin moving their sprawling economic bill across the House.
Chamber rules arbiter Elizabeth McDonough said provisions that will force drug companies to pay rebates if their prices rise above inflation rates for products they sell to private insurers should be repealed.
But drug companies have to pay those penalties if the prices of Medicare-purchased drugs rise too high.
Other parts of the legislation have survived, such as allowing Medicare to negotiate the costs of the drugs it buys, to cover out-of-pocket expenses for seniors and to provide free vaccines.
“This is a huge victory for the American people,” Senate Majority Leader Chuck Schumer, a Democrat from New York, said in a statement. “Although there is an unfortunate judgment that the inflation discount is more limited in scope, the overall program remains intact as we finally get one step closer to doing Big Pharma and lowering Rx drug prices for millions of Americans.”
Dropping penalties for drug companies due to price increases on private insurers would reduce incentives for drug companies to restrict their fees. This will increase patient costs and reduce $288 billion in the 10-year savings that Democrats’ overall drug restrictions have been estimated to generate.