Because of those price increases, the law requires drugmakers to pay a rebate to Medicare. The rebates will be used to save seniors who take these drugs between $1 and $2,786 per dose on their medication starting in January.
This is the first time drugmakers will have to pay the penalties for outpatient drug treatments.
Over the last four quarters, 64 drugs in total had prices that increased faster than inflation and may be subject to inflation rebates because of the IRA.
The rebates are "an important tool to discourage excessive price increases and protect people with Medicare," Chiquita Brooks-LaSure, administrator for the Centers for Medicare and Medicaid Services, said Thursday.
All the drugs up for rebates are included under Medicare Part B, which covers drugs and vaccines given to patients in doctors' offices or hospital outpatient departments.
Aside from the prescription drug rebates, the IRA also calls for Medicare to negotiate prices on some of the most expensive Part D drugs.
President Biden is leaning into lowering health care costs and picking fights with the drug industry to show what he could bring to a second term and contrast with former President Trump, the frontrunner for the GOP nomination.
During remarks at the National Institutes of Health (NIH) Thursday, Biden called the high prices of drugs in the U.S. a "ripoff." He also lauded the medical research conducted at NIH.
"It's a good thing that leads to breakthroughs that save lives. But drug companies benefit considerably from that research. They could not make their own drugs without the research done here," said Biden, calling it "outrageous" that drug companies who benefit from taxpayer-funded research charge those same taxpayers more than elsewhere in the world.
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