Medicare Drug Price Negotiation Under the Inflation Reduction Act: Ensuring the Continuity of Critical Real-World Pharmaceutical Studies

We read with great interest the commentary submitted by Dr Aurora and colleagues. We appreciate their perspective on new evidence generating pathways provided by the Inflation Reduction Act (IRA) but think it is also necessary to consider other, practical implications of the act for the funding of postmarketing research and observational research in general.1 Broader signals from the industry suggest that The IRA of 2022 is expected to interfere with the manufacturers’ ability, or willingness, to fund postmarketing research. Signed into law by President Biden on August 16, 2022, the act incorporates a set of sections intended to make drugs more affordable to patients and reduce federal spending on medicines.2,3 The act is expected to decrease the national debt by $237 billion by 2031.4 The IRA introduces new medication price caps and mandatory discounts for federal payers, which are expected to reduce manufacturer revenue.5 With limited research and development resources, several major manufacturers have begun restructuring or even eliminating their own health economics and outcomes research groups in the wake of the IRA’s passage.6 Although manufacturers have not publicly stated that this is due to IRA implementation, much of this reorganization occurred immediately after Medicare began renegotiating drug prices under the provisions of the IRA. Firms in all sectors generally follow a “don’t cut where you grow” policy and reductions in force in any given area usually begin in the division of the firm that are not expected to yield growth.