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Senate Finance leaders in talks on deal to limit drug price increases

Senate Finance leaders in talks on deal to limit drug price increases
© Greg Nash

The leaders of the Senate Finance Committee are in bipartisan talks on a potentially sweeping deal to limit drug price increases in Medicare, according to sources familiar with the negotiations.

Sen. Ron WydenRonald (Ron) Lee WydenOn The Money: Dow falls more than 900 points amid fears of new COVID-19 restrictions | Democrats press Trump Org. about president's Chinese bank account | Boeing plans thousands of additional job cuts Democrats press Trump Organization about president's Chinese bank account Plaintiff and defendant from Obergefell v. Hodges unite to oppose Barrett's confirmation MORE (Ore.), the top Democrat on the panel, is pushing to make drug companies pay back rebates to Medicare’s prescription drug program, called Part D, if their prices rise faster than inflation. Another measure would force drug companies to pay money back to Medicare if they launch a new drug with a high price. 

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Finance Committee Chairman Chuck GrassleyCharles (Chuck) Ernest GrassleyBarrett confirmation stokes Democrats' fears over ObamaCare On The Money: Power players play chess match on COVID-19 aid | Pelosi bullish, Trump tempers optimism | Analysis: Nearly 1M have run out of jobless benefits Grassley: Voters should be skeptical of Biden's pledge to not raise middle class taxes MORE (R-Iowa) has not ruled the idea out; asked specifically about the paybacks for price increases that outpace inflation, he confirmed he was involved in the discussions.

“I’m not going to answer your question for this reason, that we’re negotiating on that,” Grassley told The Hill.

“We’ve got to get a bipartisan agreement,” he added.

But some GOP senators are pushing back on the far-reaching proposal, arguing it comes too close to price controls for drugs, which Republicans have long opposed.

Grassley and Wyden have been in talks for months on a package to lower drug prices, but this proposal could have a greater impact than other ideas that have been discussed, such as rearranging the incentives for different industry players in Medicare Part D.

Wyden declined to comment on the specifics of the negotiations but said that he is pushing to make sure there are significant changes that actually lower the cost of drugs in any deal he signs on to.

“You’ve got to have meaningful steps to rein in high drug prices, and the chairman and I are talking about [the drug pricing package] every day, sometimes several times a day, and the focus is on getting it right,” Wyden told The Hill last week.

The proposal could face a tough road among rank-and-file GOP lawmakers.

Grassley is well known as an advocate of lowering drug prices and has been willing to oppose the powerful pharmaceutical industry on some issues — to a much greater degree than many other Republican lawmakers.

Sen. Mike CrapoMichael (Mike) Dean CrapoBarrett says she did not strike down ObamaCare in moot court case GOP Sen. Thom Tillis tests positive for coronavirus 22 GOP attorneys general urge Congress to confirm Barrett as Supreme Court justice MORE (R-Idaho), a senior member of the Finance Committee, told The Hill on Tuesday that he is “evaluating” the rebate proposal. “I haven’t reached a conclusion on it yet,” he said.

Asked if other GOP senators thought the idea went too far, Crapo replied, “That’s what I understand.”

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Drug companies, a powerful force in Washington, are sure to oppose the idea, adding to its obstacles.

Still, there appears to be momentum on both sides for taking some action on drug pricing.

President TrumpDonald John TrumpBiden campaign slams Facebook after thousands of ads blocked by platform's pre-election blackout Mnuchin says he learned of Pelosi's letter to him about stimulus talks 'in the press' Harris to travel to Texas Friday after polls show tie between Trump, Biden MORE has been calling for lower drug prices for years, and his staff is in talks with Speaker Nancy PelosiNancy PelosiMnuchin says he learned of Pelosi's letter to him about stimulus talks 'in the press' On The Money: Trump makes a late pitch on the economy | US economy records record GDP gains after historic COVID-19 drop | Pelosi eyes big COVID-19 deal in lame duck Pelosi challenger calls delay on COVID-19 relief bill the 'privilege of politics' MORE’s (D-Calif.) office about allowing Medicare to negotiate drug prices in some form.

But the Senate Finance Committee is working on a separate track, and Grassley has said he opposes giving Medicare that negotiation authority.

The Finance Committee’s timeline has slipped. Grassley had been trying to release a drug pricing bill by mid-June, but that date has now been pushed back to July.

The Senate Health Committee, which has its own package aimed at protecting patients from surprise medical bills along with other provisions, is moving at a faster pace, with a markup slated for Wednesday.

If the Finance Committee can reach a deal, that bill could be combined with the Health Committee package when it goes to the full Senate for a vote.

Sen. Lamar AlexanderAndrew (Lamar) Lamar AlexanderThe spectre of pension failures haunts this election Bitter fight over Barrett fuels calls to nix filibuster, expand court Senate Health Committee chair asks Cuomo, Newsom to 'stop second guessing' FDA on vaccine efficacy MORE (R-Tenn.), the Health Committee chairman, said Tuesday that he hopes his package, along with any health bills that could be added from the Finance or Judiciary committees, would get a vote on the Senate floor before the end of July.