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Congress·In Committee·12 months ago

New Bill Proposes Delaying Medicare Price Negotiations for Common Pills by Four Years

Also known as: EPIC Act of 2025

Legislative Progress

✓ Filed
Review
Senate
House
President

Impacts

Negative Impacts(4)
Medicare
Hurts

Delays Medicare's ability to negotiate lower drug prices for common pills by 4 extra years, keeping program costs higher for longer.

Retiree
Hurts

Seniors on Medicare could face higher out-of-pocket costs for brand-name pills since price negotiations would be delayed.

Chronic Illness
Hurts

People who rely on daily brand-name medications may pay more for longer before negotiated prices kick in.

Disability Benefits
Hurts

Many people on Medicare due to disability take small-molecule drugs that would face delayed price negotiations.

Mixed Impacts(1)
Small Business Owner
Neutral

Biotech and pharma small businesses may benefit from longer exclusivity, but small employers face higher drug plan costs.

Key Points

  • Senator Tillis introduced a bill that would change how long the government must wait before negotiating lower prices for certain prescription drugs. Currently, Medicare can start negotiating prices for 'small-molecule' drugs—which are most standard pills—seven years after they are approved for sale.
  • The bill would increase this waiting period to 11 years starting in 2028. This change would make the timeline for pills the same as the timeline for 'biologics,' which are more complex medicines usually given by injection or IV.
  • This policy would mostly affect seniors and people with disabilities who rely on Medicare. By waiting four extra years to negotiate, the government and patients might continue paying higher brand-name prices for popular medications for a longer period of time.
  • The goal of the change is to encourage drug companies to keep inventing new pills. Supporters argue that the current seven-year limit makes it too hard for companies to earn back the money they spent on research, which could stop them from creating new cures.
  • If this becomes law, it would slow down the government's ability to lower costs for some of the most common brand-name drugs on the market. This could result in higher spending for the Medicare program and potentially higher out-of-pocket costs for some patients.
Prescription DrugsMedicare MedicaidHealthcare

Milestones

2 milestones2 actions
Mar 4, 2025Senate

Read twice and referred to the Committee on Finance.

Mar 4, 2025

Introduced in Senate

What Happens Next

Projected impacts based on AI analysis

2028-01-01

New 11-year waiting period takes effect for drug price negotiations

Starting in 2028, Medicare would have to wait 11 years instead of 7 before negotiating prices on common pills, meaning fewer drugs eligible for lower prices.

Related News

3 articles
Axios·10 months ago

1 big number: EPIC Act score

Eliminating the 'pill penalty' in the Inflation Reduction Act's drug price negotiations would cost about $10 billion over a decade, according to a preliminary CBO score. The proposal, known as the EPIC Act, is a priority of pharmaceutical manufacturers to lengthen the negotiation wait time.

C=
BioWorld·12 months ago

Ending 'pill penalty' challenges sacred cow status of IRA

The EPIC Act aims to put small-molecule drugs on parity with biologics by setting a negotiation clock of 11 years before eligibility. While supporters call it a 'straightforward fix,' critics argue it targets a 'sacred cow' of the Biden administration's signature legislative achievement.

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The Hill·11 months ago

Incubate Executive Director Joins The Hill's Roundtable on the EPIC Act

A roundtable hosted by The Hill explored how the 'pill penalty' impacts medical innovation. Participants discussed the EPIC Act's role in restoring investment incentives for small-molecule treatments, which have seen a decline in funding since the Inflation Reduction Act's passage.

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Source Information

Document Type

Congressional Bill

Official Title

EPIC Act of 2025

Bill NumberS 832
Congress119th Congress
ChamberSenate
Latest ActionRead twice and referred to the Committee on Finance.

Sponsor

Cosponsors

(7)
R: 7

Analysis generated by AI. While we strive for accuracy, this should not be considered legal or professional advice. Always verify information with official government sources.