The U.S. Department of Health and Human Services (HHS) continues to negotiate with pharmaceutical companies wishing to participate in the inaugural cycle of Medicare drug price negotiations. The drug manufacturers have responded with their own pricing propositions as HHS aims to reduce the cost of prescription medications.

According to an HHS news release, this ongoing negotiation between the department and pharmaceutical companies is part of the Inflation Reduction Act. This legislation forms a key component of the Biden administration's initiative to make common drugs more affordable. The HHS initiated negotiations by extending an offer to drug manufacturers on Feb. 1. The department is expected to continue these discussions for the foreseeable future. If an agreement is reached, the agreed-upon price will be disclosed on Sept. 1 and implemented by 2026. The Centers for Medicare & Medicaid Services (CMS) supports this proposal.

"We are committed to constructive dialogue and are glad the drug companies are coming to the table," said HHS Secretary Xavier Becerra. "These are good-faith, upfront negotiations. The Biden-Harris Administration is working to lower costs for families and keep money in the pockets of millions of Americans instead of Big Pharma."

The news release also indicates that over eight million individuals residing in rural communities will benefit from this act. By 2025, all enrollees in Medicare Part D will have their out-of-pocket prescription drug costs capped at $2,000.

"CMS is dedicated to improving access to some of the most expensive drugs for people with Medicare while encouraging market competition and fostering innovation through this first-of-its-kind negotiation process," said CMS Administrator Chiquita Brooks-LaSure. "Receiving counteroffers marks another negotiation milestone met in the continued implementation of the landmark Inflation Reduction Act, which is already lowering drug prices for people with Medicare."