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Incubate Responds to Maximum Fair Prices Announced for Next 15 Medicare Drugs

WASHINGTON (November 26) -- Yesterday, the Trump administration announced Maximum Fair Prices (MFPs) for the next 15 Medicare Part D drugs selected for price setting under the Medicare Drug Price Negotiation Program. The new prices take effect in January 2027.

 

Incubate's executive director, John Stanford, issued the following statement in response to the announcement:

 

"Today's announcement is another reminder of the fundamental flaws in existing federal drug-pricing policy and in the broader move towards a European-style valuation of innovation. Any and all price control mechanisms -- including the Medicare Drug Price Negotiation Program -- threaten to dismantle the very ecosystem that makes breakthrough drug development possible.

 

"Particularly concerning is CMS's ongoing failure to address the pill penalty. All 15 drugs selected this year are small molecule therapies, which are subject to price controls four years earlier than biologics. Eight of the 15 drugs would not have been eligible for selection if small molecules and biologics enjoyed the same 13-years exemption period.

 

"This distortion discourages investment in medicines that are often the most affordable and accessible treatment options. Incubate's survey of biotech CEOs found that the majority warn that below-cost reimbursement models, including price controls, lead to negative outlooks for companies and discourage the investment needed to advance early-stage innovation.

 

"Congress can correct this disparity with bipartisan solutions like the Ensuring Pathways to Innovative Cures (EPIC) Act, which would fix the pill penalty and ensure that policy reflects scientific realities rather than arbitrary timelines. On the other hand, doubling down on misguided price controls by any name would only stifle innovation, restrict patient access, and threaten American leadership in biotech."

To learn more about how policy is impacting investments in the life sciences, visit Incubate's Life Sciences Investment Tracker.

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About Incubate

Incubate is a 501(c)(4) organization of venture capital firms representing the patient, corporate, and investment communities. Our primary aim is to educate policymakers on the role of venture capital in bringing promising treatments to patients in need.

 


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