Does this sound like drug negotiations?

The Sen­ate drug agreement would re­quire the Health and Hu­man Ser­vices Sec­re­tary to “ne­go­ti­ate” prices for 10 of the top-spend­ing drugs in Medicare start­ing next year and 20 by the end of the decade. If drug mak­ers don’t ac­cept the gov­ern­ment’s of­fered price, they would get slapped with a 95% ex­cise tax on their sales. Take his of­fer or else.

Wall Street Journal 7-28-22

Once the ne­go­ti­a­tion process is es­tab­lished, it will be far eas­ier for De­moc­rats to ex­pand the list of cov­ered med­i­cines to meet what­ever their next spend­ing goal is. This time around De­moc­rats plan to use the $200 bil­lion or so in drug sav­ings to ex­tend sweet­ened Af­ford­able Care Act (ACA) sub­si­dies for three years and cap Medicare Part D out-of-pocket costs at $2,000.

Wall Street Journal 7-28-22

Savings, what savings? It seems actually saving money is impossible as we rather extend more subsidies or create new obligations.

Opponents of this sham negotiation is say it will stifle new drug innovation. To what extent we don’t know, but there will be consequences. What happens the next time enhanced ACA subsidies are about to expire? By then millions of Americans have gotten used to the fake premiums they are paying and there will be another excuse to extend them – another new revenue source needed or perhaps just higher debt.

But wait, if a company loses income because Medicare is saving money on 10-20 drugs why wouldn’t the drug company make up the loss on other than the 20 drugs and on the drugs used by the non-Medicare population?


  1. It appears this will become a covert fundraiser for ACA subsidies or whatever. The big pharmaceuticals won’t skip a beat and will make up a negotiated loss to Medicare and tack on a couple of dollars to the meds the ordinary public is paying for and Medicare and Congress can beat their chests and say look what we accomplished. We saved money .
    The chumps will be the same old taxpayers.


  2. My understanding of an excise tax is that it is a tax at the point of manufacture as opposed to the point of sale (sales tax). An excise tax is not taxing a company’s profit on a product but is taxing the value of the product leaving the manufacturer. It is more a like tariff except the product doesn’t cross a border. There is a federal excise taxes on gasoline in addition to each state’s fuel taxes per gallon in place of a sales tax which does nothing to force the refiners to charge less for a gallon of gasoline. I fail to see how a 95% excise tax is not going to double the cost of medicine for all drug plans including Medicare. More people will not be able to afford their medication especially those that have to pay totally out of pocket.


  3. The top 10 drugs are the big brand names that are constantly advertised on TV. ( Big pharma commercials are longer and more colorful than those for other products for some reason). These drugs could have gone generic but the manufacturers always find a way to change a molecule and then extend the patent.
    There are alternatives for these very expensive drugs but many have been convinced the newer drugs are vastly superior. Eliquis ( a blood thinner) is the number 1 drug that Medicare spends the most on . It costs over $500 a month. My husband abd many other patients do just fine on the old standby Warfarin which costs about 10 dollars a month. You do have to get your blood tested more often when on Warfarin but he doesn’t consider it a hassle.


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