HHS Secretary Xavier Becerra Releases Bold Proposal to Lower Prescription Drug Costs

Today, Health and Human Services (HHS) Secretary Xavier Becerra released a comprehensive plan to lower drug prices. The Drug Pricing Plan is part of a broader initiative stemming from President Joe Biden’s Executive Order on Promoting Competition in the American Economy, which also created the White House Competition Council tasked with coordinating, promoting, and advancing Federal Government efforts to address overconcentration, monopolization, and unfair competition in or directly affecting the American economy. The Report released by HHS is guided by the Administration’s principles for equitable drug pricing reform through competition, innovation, and transparency.

“Life-saving prescription medication should not cost anyone their life savings. Yet too often, many low-income families cannot take their prescription medications because of cost concerns,” said Health and Human Services Secretary Xavier Becerra. “The Biden-Harris Administration remains committed to making health care more affordable for American families, and this Plan outlines one key way we will do that. By promoting negotiation, competition, and innovation in the health care industry, we will ensure cost fairness and protect access to care.”

Americans pay too much for prescription drugs – more than $1,500 per person – and pay prices that are far higher than any comparable nation. Prices for brand name drugs are rising faster than inflation. Many Americans do not take medications as prescribed because of their cost, with resulting harm to their health care and health. Lack of competition is a key factor in these high drug costs.

The Drug Pricing Plan responds to the request in President Biden’s Executive Order for “a plan to continue the effort to combat excessive pricing of prescription drugs and enhance domestic pharmaceutical supply chains, to reduce the prices paid by the Federal Government for such drugs, and to address the recurrent problem of price gouging.” The Plan presents principles for equitable drug pricing reform through competition, innovation, and transparency; describes promising legislative approaches; and summarizes actions already underway or under consideration across HHS.

One of the key policies in this effort is legislation that would allow the Secretary of HHS to negotiate Medicare Part B and Part D drug prices directly with pharmaceutical companies and make those prices available to other purchasers, an approach that is projected to generate reductions in patient cost-sharing and large savings for patients, government, and commercial payers.

Legislative and administrative actions consistent with the guiding principles presented in this Plan will reduce prices paid by the federal government for prescription drugs, curb brand drug manufacturers’ abuse of patents and exclusivities to avoid competition, increase transparency for patients and across the drug industry, enhance domestic pharmaceutical supply chains, and address price gouging. Most importantly, these actions will protect American patients and improve their access and adherence to medications by lowering drug prices through increased competition throughout the health care system. 

Read a fact sheet on the HHS Plan.

Read the full HHS Plan.