Emerging Trends in List Price Adjustment Strategies Following Implementation of the Inflation Reduction Act
Author(s)
Kevin Brooks, MBA1, Natalie Berreth, MBA, MPH2, Justin Mathew, MBS1, Kayla Lee, BA1, Ayush Desai, BS1.
1Red Nucleus, San Francisco, CA, USA, 2Red Nucleus, Boston, MA, USA.
1Red Nucleus, San Francisco, CA, USA, 2Red Nucleus, Boston, MA, USA.
OBJECTIVES: Rising drug costs remain a prevalent topic of conversation across the industry and in the media. The Inflation Reduction Act (IRA) introduced several measures to address rising prices. This research aims to evaluate trends in annual list price adjustments for drugs following the implementation of IRA negotiations and required Medicare rebates.
METHODS: This analysis compared drugs selected for Medicare negotiations versus 300+ products from the portfolios of select top 50 market cap manufacturers. Products competing with generics/biosimilars and/or have experienced loss of exclusivity were excluded from analysis. Wholesale Acquisition Cost from January 2023 to January 2025 was collected for all products to determine the annual percent change in list price by start of years 2024 and 2025.
RESULTS: The 2025 percent change in price for all products was approximately +4%, remaining consistent with the 2024 average. Among products analyzed, Pfizer’s Atgam experienced the largest price increase at +15%. In contrast, significant price decreases were observed for Boehringer Ingelheim’s Atrovent (-35%) and Merck’s Januvia and Janumet/Janumet XR (-42.4%). Notably, Januvia is among the ten drugs undergoing IRA negotiations. Excluding Januvia, the year-over-year (YoY) percent change in price for the six other IRA negotiation products with 2025 data declined from +4.0% in 2024 to +2.4% in 2025; Eliquis had the largest shift YoY from +6% in 2024 to +2% in 2025.
CONCLUSIONS: List price adjustments reflect both product-specific and broader industry dynamics. In anticipation of IRA negotiations, IRA products are experiencing lower than average price increases. As government regulations evolve and pricing pressure on pharmaceuticals increase, assessing price adjustments in the context of anticipated payer management and government penalties will be a key consideration for manufacturers. A product’s lifecycle management strategy should include an evolving price adjustment strategy in order to limit potential negative public perceptions, mitigate risks to access, and drive continued commercial success.
METHODS: This analysis compared drugs selected for Medicare negotiations versus 300+ products from the portfolios of select top 50 market cap manufacturers. Products competing with generics/biosimilars and/or have experienced loss of exclusivity were excluded from analysis. Wholesale Acquisition Cost from January 2023 to January 2025 was collected for all products to determine the annual percent change in list price by start of years 2024 and 2025.
RESULTS: The 2025 percent change in price for all products was approximately +4%, remaining consistent with the 2024 average. Among products analyzed, Pfizer’s Atgam experienced the largest price increase at +15%. In contrast, significant price decreases were observed for Boehringer Ingelheim’s Atrovent (-35%) and Merck’s Januvia and Janumet/Janumet XR (-42.4%). Notably, Januvia is among the ten drugs undergoing IRA negotiations. Excluding Januvia, the year-over-year (YoY) percent change in price for the six other IRA negotiation products with 2025 data declined from +4.0% in 2024 to +2.4% in 2025; Eliquis had the largest shift YoY from +6% in 2024 to +2% in 2025.
CONCLUSIONS: List price adjustments reflect both product-specific and broader industry dynamics. In anticipation of IRA negotiations, IRA products are experiencing lower than average price increases. As government regulations evolve and pricing pressure on pharmaceuticals increase, assessing price adjustments in the context of anticipated payer management and government penalties will be a key consideration for manufacturers. A product’s lifecycle management strategy should include an evolving price adjustment strategy in order to limit potential negative public perceptions, mitigate risks to access, and drive continued commercial success.
Conference/Value in Health Info
2025-05, ISPOR 2025, Montréal, Quebec, CA
Value in Health, Volume 28, Issue S1
Code
HPR16
Topic
Health Policy & Regulatory
Topic Subcategory
Insurance Systems & National Health Care, Pricing Policy & Schemes, Reimbursement & Access Policy
Disease
No Additional Disease & Conditions/Specialized Treatment Areas