Rebate Rule May Be Finalized Soon, But Skepticism Lingers That Trump Can Make Lasting Changes On Rx Pricing

A long-dead rule to eliminate manufacturer rebates in Medicare has been revived by the Trump administration and could to be finalized shortly, but given its issuance so late in the president’s term and bound by the new constrictions of his own executive order, experts believe its unlikely to have much impact.

The original rebate rule was praised by the drug industry, but vehemently opposed by payers and pharmacy benefits managers. It would have eliminated rebates that manufacturers make to payers to negotiate placement on drug formularies, but was pulled in July 2019 due to concerns that eliminating the anti-kickback safe harbor that allowed for rebates would result in higher insurance costs because insurance companies and pharmacy benefits managers would lose their leverage to drive down list prices of drugs