House leaders make last-minute change on drug pricing after dispute

House Democratic leaders are making a last-minute change to their deal to lower prescription drug prices to resolve a dispute that arose over the wording of the measure, according to a source familiar with the process. 

The compromise follows a meeting Thursday night between Speaker Nancy Pelosi (D-Calif.), Rep. Scott Peters (D-Calif.) and other lawmakers to resolve the issue as House leaders race to line up the votes for President Biden’s social spending package.

The compromise will add an additional year of exclusivity before Medicare will be able to negotiate prices for certain complex drugs known as biologics, moving the total from 12 years to 13 years. 

The last-minute dispute arose from how the text of the drug pricing agreement was drafted. The agreement announced earlier this week was to allow Medicare to negotiate drug prices after a period of exclusivity: nine years for many drugs and 12 years for more complex biologics. 

This was actually written down in the text with the numbers seven years and 10 years, though, because drafters noted there is a two-year delay for the negotiation process to play out, meaning the numbers seven and 10 in actuality translated to nine and 12. 

Peters and a handful of other moderates wanted the exclusivity period to fully expire before negotiations could begin, the source said, effectively adding another two years, to bring the totals to 11 years and 14 years, depending on the type of drug. 

The compromise will instead add one year only to biologics, bringing the totals to nine years and 13 years. 

The end result is another shift towards the position of Peters and other moderates like Reps. Kurt Schrader (D-Ore.) and Kathleen Rice (D-N.Y.), who have raised concerns that drug pricing reform should not harm innovation from pharmaceutical companies. 

Delaying the start of Medicare negotiating drug prices by any amount of time was already a concession to their position. But many drug pricing advocates have still praised the agreement announced earlier this week as a step in the right direction, even if it does not go as far as they would like.