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SMART Prices Act
3/12/2024, 2:26 AM
Summary of Bill S 1246
The SMART Prices Act aims to increase transparency in the pharmaceutical industry by requiring drug manufacturers to provide detailed information on the costs associated with producing their medications. This information would then be used to determine a fair and reasonable price for each drug, taking into account factors such as research and development costs, production expenses, and the need for a reasonable profit margin.
Additionally, the SMART Prices Act would establish a new government agency, the Prescription Drug Pricing Commission, which would be responsible for overseeing the pricing of prescription medications. This commission would have the authority to review and approve drug prices, as well as to investigate any instances of price gouging or other unfair pricing practices. Overall, the SMART Prices Act is aimed at addressing the issue of skyrocketing prescription drug prices in the United States by increasing transparency in the pharmaceutical industry and ensuring that medications are priced fairly and reasonably. This bill has the potential to have a significant impact on the affordability of prescription drugs for millions of Americans.
Congressional Summary of S 1246
Strengthening Medicare And Reducing Taxpayer Prices Act or the SMART Prices Act
This bill modifies requirements of the Medicare Drug Price Negotiation Program and makes other changes with respect to the prices of prescription drugs under Medicare.
Current law requires the Centers for Medicare & Medicaid Services (CMS) to negotiate maximum prices for brand-name drugs that do not have other generic equivalents and that account for the greatest Medicare spending. The CMS must negotiate the prices of 10 drugs that are covered under the Medicare prescription drug benefit in 2026, 15 drugs that are covered under the Medicare prescription drug benefit in 2027, 15 drugs that are covered under the Medicare prescription drug benefit or under Medicare medical services in 2028, and 20 drugs that are covered under the Medicare prescription drug benefit or under Medicare medical services in 2029 and each year thereafter.
The bill requires the CMS to negotiate the prices of 20 drugs under the Medicare prescription drug benefit in 2026 and 40 drugs under the Medicare prescription drug benefit or under Medicare medical services in 2027 and each year thereafter. It also (1) shortens the required period of market approval from 7 years and 11 years for drugs and biologics, respectively, to 3 years; and (2) modifies the ceiling for the maximum fair price for short-, extended-, and long-monopoly drugs.
The bill also repeals provisions that prohibit the CMS from interfering in negotiations between drug manufacturers, pharmacies, and PDP sponsors (i.e., noninterference clause).
