Health systems experience difficult trade-offs when paying for new drugs. In England, funding recommendations by the National Institute for Health and Care Excellence (NICE) for new drugs might generate health gains but inevitably result in forgone health as the funds cannot be used for alternative treatments and services. We aimed to evaluate the population health impact of NICE recommendations for new drugs during 2000–20.

The Inflation Reduction Act instructs Medicare to negotiate prices of top-selling drugs and sets statutory upper limits (“ceilings”) on negotiated prices. Medicare can negotiate prices below the ceilings based on how prices and clinical benefits of these drugs compare with those of therapeutic alternatives. In August 2024, Medicare published the negotiated prices for the first 10 drugs selected for negotiation; these prices will come into effect in 2026 and will apply to all Medicare Part D plans. We analyzed how negotiated prices in the US compared with net prices before negotiation, ceiling prices, and list prices in 6 other high-income countries.

Biologics approved by the US Food and Drug Administration (FDA) receive 12 years of guaranteed protection from biosimilar competition compared with 5 years of protection from generic competition for new small-molecule drugs. Under the 2022 Inflation Reduction Act, biologics are exempt from selection for Medicare price negotiation for 11 years compared with 7 years for small-molecule drugs. Congress codified these differing legal protections on the premise that biologics require more time and resources to develop and have weaker patent protection, necessitating additional protections for manufacturers to recoup their development costs and generate adequate returns on investment.