The most revealing information on Medicare drug prices yet to come

The Biden administration has disclosed what Medicare will pay for the first graduates of the Medicare drug price negotiation program, but it hasn’t revealed how those prices were determined. That information, which is vital to inform decisions that will shape the future of medicine, is likely to remain secret for six months and may never be fully disclosed.

For biopharma companies and investors, patient advocates and lawmakers, learning how CMS came up with the prices of the first cohort of drugs subject to the Medicare drug price negotiation process is far more important than the prices themselves. Understanding the factors that led CMS to reduce prices, and the arguments that were unpersuasive, could guide research investment decisions and provide indicators about how drugs will fare in future negotiations. Additionally, information about the drugs CMS used to benchmark prices could help companies assemble effective dossiers and give patient advocates insights needed to assess the process. ...