Presentation (CTI)

OBJECTIVES: We evaluate the interaction between the Inflation Reduction Act’s Medicare Drug Price Negotiation Program (MFP) and the proposed Most Favored Nation (MFN) for Eliquis and Imbruvica. We assess potential conflicts and likely impacts on manufacturers’ commercialization plans.
METHODS: Eliquis and Imbruvica were selected to represent MFP-negotiated drugs, and their 2026 MFP prices were compared to MFN prices (Canada). OECD countries with ≥60% of US GDP per capita were identified and their drug prices computed. Country prices were divided by an adjustment ratio (OECD:US GDP per capita) to arrive at the MFN price. Revenue impacts were calculated using 2023 Medicare utilization data and manufacturers’ SEC filings while assuming 9 million Eliquis scripts and 55,000 Imbruvica scripts.
RESULTS: Analysis revealed three key findings. First, MFN benchmarks were significantly lower than MFP prices for Eliquis -- MFN ($111) being 51.8% below its MPF price ($231) -- while Imbruvica’s MFN price ($10,202) was 9.4% higher than its MFP price ($9,319) when looking at 30-day supplies for the Medicare channel. Second, implementing MFN for these two therapies could create significant added revenue loss beyond MFP, worth more than $1Bn annually for Eliquis and more than $4Bn annually for Imbruvica based on current Medicare utilization data. Third, given PBM and intermediary incentives, this would likely include the elimination of millions in PBM rebates if only MFN pricing were applied.
CONCLUSIONS: MFN and MFP create disparities in pricing. If CMS exempts MFP negotiated products from MFN, preserving Medicare bargaining power, this still creates potential market distortions when direct competitors (non-MFP drugs) receive MFN pricing. There will be a need to consider 1) applying MFN only to drug classes without MFP-negotiated alternatives or 2) implementing a price corridor system where MFP cannot exceed their competitor MFP price by more than 20-25%. This would maintain negotiation incentives while preventing therapeutic class disparities.