Part D Manufacturer Discounts Set To Grow In 2020 With Catastrophic 'Cliff'
With no legislative remedy in sight, the Medicare Part D out-of-pocket payment threshold will increase by $1,250 in 2020, causing many beneficiaries to linger longer in the coverage gap, where manufacturers provide 70% discounts on branded drugs.
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Pfizer, BMS and Lilly see sales impacted by Part D changes that leave some beneficiaries in the coverage gap longer this year, extending manufacturer discount obligations.
Government price 'negotiations' unlikely to be enacted in the near term, CEO Ricks tells investors, but reform of the Part D benefit also faces long odds, even though Lilly would support well designed changes.
Price inflation rebates are expected to generate $50bn in savings over 10 years, according to the Congressional Budget Office.