A pair of pilot programs recently introduced by CMS aims to reduce Medicare spending on prescription drugs as well as lowering out-of-pocket costs for beneficiaries.
The programs, known as the Guarding U.S. Medicare Against Rising Drug Costs (GUARD) and Global Benchmark for Efficient Drug Pricing (GLOBE) models, were announced on Dec. 19, the same day President Trump announced drug pricing deals under his “most favored nation” policy with nine additional drugmakers.
The GUARD program would mandate that pharmas pay rebates for drugs covered under Part D if the prices are more than those paid in other economically comparable countries. It would run from Jan. 1, 2027-Dec. 31, 2031.
GLOBE is similar to GUARD, but applies to drugs under Part B.
The rebates are “an alternative to the manufacturer rebates currently calculated under the Medicare Inflation Rebate Programs, which were established by the Inflation Reduction Act of 2022 (IRA) and require manufacturers to pay rebates to the Medicare Trust Fund for certain drugs whose prices grow faster than inflation,” according to law firm Mintz.
The Pharmaceutical Research and Manufacturers of America (PhRMA), the lobbying group for major drugmakers, has objected to the programs.
“Government policies that mandate broad-based foreign price controls are bad for American patients and undermine U.S. leadership,” the organization said in a statement. “By CMS’ own admission, the proposed policies are projected to increase costs for America’s seniors, and they will siphon billions from U.S. medicine R&D at a time when China is on the verge of surpassing us.”