drug pricing
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CMS sets inflation penalties on 43 drugs


In a move towards curbing rising drug prices, the Inflation Reduction Act (IRA) provision will impose penalties on drugmakers for increasing prices at a faster rate than inflation for individuals covered by Medicare. As a result, drug manufacturers will now be required to pay the difference in the prices of 43 drugs to Medicare, the federal health program catering to Americans aged 65 and above.

Earlier this year, President Biden’s administration had identified 27 drugs that would be subjected to inflation penalties for the second quarter. However, the recently released list of 43 drugs will replace the previous selection, applying to the third quarter of 2023. The decision aims to ensure that drugmakers are held accountable for their pricing practices, particularly when their prices outpace inflation rates.

The Centers for Medicare & Medicaid Services (CMS) stated that individuals covered by Medicare who rely on these 43 drugs could experience substantial savings, ranging from $1 to $449 per average dose, starting from July 1. The extent of the savings will vary based on each individual’s coverage under Medicare.

The list of drugs that will face inflation penalties for the third quarter includes AbbVie’s popular arthritis drug, Humira, as well as Seagen’s targeted cancer therapy, Padcev. Notably, these drugs have appeared on the list for the second time.


  1. Reuters. U.S. government sets penalties on 43 drugs over price hikes.  [Accessed 12/06/2023]
  2. FirstWord Pharma. CMS bumps up list of drugs marked for inflation penalties [Accessed 12/06/2023]

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