CMS Officials Propose Requiring Drug Manufacturers to Disclose Drug Prices in TV Ads

OCTOBER 16, 2018
Colleen Hall
Officials with the the Centers for Medicare & Medicaid Services this week proposed a requirement that prescription drug manufacturers post the Wholesale Acquisition Cost (WAC) for drugs covered in Medicare or Medicaid in direct-to-consumer television advertisements.1

“This historic proposal is an important way to create new incentives for drug companies to start lowering their list prices, rather than raising them,” HHS Secretary Alex Azar explained in a press release about the proposal. “President Trump’s drug-pricing blueprint called for HHS to consider how to accomplish this goal, and now we are following through on this measure to better inform patients, help them lower their drug costs, and reduce unreasonable spending in Medicare and Medicaid.” Azar announced the plan during a speech at the National Academy of Medicine.

Officials with the Pharmaceutical Research and Manufacturing Association (PhRMA) said in a press release that they plan to request member companies’ direct-to-consumer (DTC) television advertisements to direct patients to information about medicine costs, including the list price of the medicine, out-of-pocket costs or other context about the potential cost of the medicine and available financial assistance.2 PhRMA officials noted that the biopharmaceutical industry will also launch a new platform that will provide patients, caregivers and providers with cost and financial assistance information for brand-name medicines, as well as other patient support resources.

“Our member companies are taking a new approach to how they communicate about medicines in DTC television advertisements to make it easier for patients to access information about medicine costs,” said Stephen J. Ubl, president and chief executive officer of PhRMA. “The Administration and Congress have called on our industry to provide cost information in DTC advertisements, and our members are voluntarily stepping up to the plate.”

But the CMS' proposed rule would require prices for a typical course of treatment for an acute medication like an antibiotic, or a 30 day supply of medication for a chronic condition that is taken every month, and the posting would take the form of a legible textual statement at the end of an ad.  The HHS Secretary would maintain a public list of drugs that were advertised in violation of this rule. CMS officials note they would likely provide an exception to the requirement to post prices for prescription drugs with list prices of less than $35 per month.

CMS officials are also seeking comment on whether the regulation should apply to advertisements in other media forms such as radio, magazines, newspapers, websites, and social networking sites.

References
1. CMS Proposes to Require Manufacturers to Disclose Drug Prices in Television Ads [CMS newsroom].  Washington, DC; The Centers for Medicare & Medicaid Services Office of Communications. Oct. 15, 2018. https://www.cms.gov/newsroom/press-releases/cms-proposes-require-manufacturers-disclose-drug-prices-television-ads
2. PhRMA Members Take New Approach to DTC Television Advertising [PHRMA newsroom]. Washington, DC. Oct. 15, 2018. https://www.phrma.org/press-release/phrma-members-take-new-approach-to-dtc-television-advertising

 

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