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WASHINGTON (AP) — The Senate congressman cut Democrats’ plan to cut drug prices but left it virtually unscathed on Saturday, Democrats said, as party leaders prepared to start pushing through their sprawling economic bill in the chamber.
Elizabeth MacDonough, the chamber rules arbiter, said provisions that would force drugmakers to pay rebates if their prices exceed inflation for products they sell to private insurers must be scrapped. Pharmaceutical companies would have to pay these penalties if their prices for Medicare-purchased drugs rose too much.
Other restrictions on rising pharmaceutical costs have survived, including letting Medicare negotiate the costs of the drugs it buys, capping out-of-pocket expenses for seniors, and providing free vaccines.
“This is a major victory for the American people,” Senate Majority Leader Chuck Schumer, DN.Y., said in a statement. “Although there was an unfortunate decision that inflation reimbursement has a more limited scope, the overall program remains intact and we are on the verge of finally taking on Big Pharma and reducing drug prices. Rx for millions of Americans.”
The parliamentarian’s decision came after a 10-day period in which Democrats resurrected key elements of President Joe Biden’s national agenda after their apparent deaths. In quick deals with the Democrats’ two most unpredictable senators — first conservative Joe Manchin of West Virginia and then Arizona centrist Kyrsten Sinema — Schumer pulled together a sweeping package on climate change, energy , health care costs and even deficit reduction, all in the context of the legislative elections this fall.
Removing sanctions on drugmakers for raising prices from private insurers was a clear setback for Democrats. The decision reduces incentives for pharmaceutical companies to limit their fees, which increases costs for patients.
It will also reduce the $288 billion in 10-year savings that Democrats’ blanket drug restrictions were meant to generate — possibly by tens of billions of dollars, analysts say.
Even so, the congressman’s decision has left Democrats in a position to promote the drug provisions as a boon to consumers at a time when voters are enraged by the worst inflation in four decades.
Senate Finance Committee Chairman Ron Wyden, D-Ore., said that while he was “disappointed” that penalties for higher drug prices for privately insured consumers had been removed, “legislation nonetheless puts a substantial brake on Big Pharma’s ability to raise prices.”
Schumer planned to begin Senate votes on the comprehensive bill later on Saturday. The measure faces unanimous Republican opposition, but with the support of Manchin and Sinema, Democrats should be able to pass the measure through the Senate 50-50, thanks to Vice President Kamala Harris’ decisive vote.
The switch to the House could take place when that House returns briefly from recess on Friday.
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