Response to Senate Finance Committee Democrat’s RFI on policy options to reduce drug prices
Ranking Member
Committee on Finance
United States Senate
219 Dirksen Senate Office Building
Washington, DC 20510
Submitted electronically to drugs@finance.senate.gov
RE: Comments on Request for Information: Common sense Policy Options to Lower Drug Prices for Patients
Dear Ranking Member Wyden and Senate Finance Committee Democrats:
The HIV+Hepatitis Policy Institute is a national organization promoting quality and affordable healthcare for people living with or at risk of HIV, hepatitis, and other serious and chronic health conditions. We thank Ranking Member Wyden and Senate Finance Committee Democrats for the opportunity to comment on this Request for Information and share your goal of ensuring that prescription drugs are affordable and accessible to patients.
More than 111,000 Medicare beneficiaries are currently living with HIV, and that number is expected to roughly double over the next decade as people with HIV live longer, healthier lives and age into the program.[1] Medicare plays a critical role in providing lifesaving HIV and hepatitis treatment, helping people live longer, healthier lives. Medicare is also essential to HIV prevention. As a USPSTF Grade A-rated preventive service, pre-exposure prophylaxis (PrEP) must be covered by Medicare without cost-sharing or prior authorization. For patients managing lifelong, adherence-dependent conditions like HIV and hepatitis, if their prescribed medication is covered by their plan, affordability at the pharmacy counter is often a major factor in long-term health outcomes.
Drug-pricing policies should be evaluated based on whether they reduce what patients pay at the point of care without undermining access to treatment or the safety-net programs on which underserved communities rely. We therefore welcome the RFI’s focus on proposals that would directly reduce patients’ out-of-pocket costs, including extending cost-sharing caps to additional chronic-care medicines and basing cost-sharing on plans’ net costs rather than list prices.
With these principles in mind, we offer the following comments on selected proposals affecting prescription-drug affordability, access, and innovation for people living with or at risk of HIV and hepatitis.
Section I: Lowering Drug Prices
International Reference Pricing in Medicare Negotiation
We believe that international reference pricing and Most Favored Nation (MFN)-style benchmarks should not be incorporated into the ceiling price for Medicare drug price negotiation. Foreign list prices do not reflect how prescription drugs are priced, paid for, or accessed in the United States. Many of the countries used as reference points for MFN proposals operate centralized or government-run health systems that negotiate or set drug prices on a national basis. The United States does not operate under a single national purchasing system. Instead, U.S. drug pricing reflects a complex mix of mandatory statutory rebates, negotiated discounts, and safety-net programs that substantially lower net prices and support access to care. These obligations directly shape pricing decisions and play a critical role in supporting patient affordability. List prices in the U.S. reflect these layered requirements, which differ fundamentally from pricing structures in other countries.
These U.S.-specific obligations include:
- Statutory rebates: Manufacturers paid an estimated $58 billion in annual Medicaid rebates[2] and supplied more than $100 billion in prescription drugs at statutorily discounted prices through the 340B Drug Pricing Program in 2025, supporting safety net providers and the services they deliver to patients.[3]
- Commercial rebates: Total manufacturer rebates paid to Pharmacy Benefit Managers (PBMs) and insurance companies reached $334 billion for all brand-name drugs in 2023.[4]
- Additional HIV drug rebates: HIV drug manufacturers provide over $1.4 billion in annual rebates to states’ AIDS Drug Assistance Programs (ADAPs), further offsetting the cost of HIV medications.[5]
- Direct patient support: Beyond rebates, manufacturers contributed approximately $21 billion in copay assistance in 2024, while also maintaining patient assistance and free drug programs for people who are uninsured or underinsured.[6]
- Global access commitments: Manufacturers, particularly those that have HIV and hepatitis drugs, enter into voluntary licensing agreements that enable generic manufacturers to produce a range of medicines for low- and middle-income countries at deeply reduced prices, making therapies more affordable and accessible to patients across multiple disease areas. HIV companies also support large-scale public health initiatives, including the President’s Emergency Plan for AIDS Relief (PEPFAR) and the Global Fund to Fight AIDS TB, and Malaria, which provide HIV medications at low or no cost in high-burden countries. Of the more than $700 million in global HIV-related philanthropic contributions annually, drug manufacturers account for over $300 million of that total.[7]
By failing to account for these existing responsibilities and circumstances, international pricing models rely on a pricing benchmark that overlooks how U.S. list prices already incorporate substantial downstream obligations that reduce net prices and help support patient access. Manufacturer revenues support not only statutory and contractual requirements, but also patient-facing and public health programs that make medications affordable in practice. At the same time, reduced manufacturer revenue may threaten the viability of copay assistance, patient assistance programs, and public health initiatives that many patients depend on to afford and access care. Policies that significantly reduce these resources risk unintended consequences for patients in the United States and globally.
More broadly, reliance on foreign price benchmarks represents a departure from how pricing policy is approached elsewhere in the U.S. economy. The United States does not base prices for other products or services on prices set in foreign markets. For example, the average price of a loaf of bread in the United States is approximately $3.67, compared to about $2.00 in Germany and $2.39 in Australia.[8] Yet U.S. grocery stores do not price bread based on foreign benchmarks because prices reflect domestic supply chains, labor markets, regulatory structures, and economic conditions. In healthcare, payment rates for physician services, hospital care, and other medical services are set through domestic systems that reflect U.S. laws and market conditions. Applying foreign list prices uniquely to prescription drugs creates an inconsistent approach that does not reflect how patients actually experience affordability in the U.S. healthcare system.
In addition, the foreign prices used as benchmarks often rely on faulty cost-effectiveness assessments, including the use of the Quality Adjusted Life Year (QALY) formula which Congress banned Medicare from using in coverage and reimbursement decisions. Multiple government and private studies have concluded that the use of QALYs undervalues the lives of older adults, people with disabilities, and individuals living with chronic or life-threatening conditions.[9] Aligning Medicare payment policy with prices shaped by these frameworks risks importing standards that conflict with long-standing U.S. disability protections and patient access principles.
Finally, we would note that CMS’ own modeling of a comparable MFN-style rebate policy (the GUARD Model) projects a combined $3.6 billion increase in Medicare beneficiary premiums and out-of-pocket spending, even as it generates federal savings.[10] A substantial body of evidence shows that even modest increases in patient costs are associated with lower adherence, delayed care, and worse health outcomes.[11] A 2021 report from IQVIA found that Medicare beneficiaries who have a copay of $75 or more abandon their medication 25 percent of the time.[12] For patients who depend on continuous therapy to maintain health and prevent disease progression, increases in premiums or out-of-pocket costs can have immediate and lasting consequences. Any international pricing proposal that shifts costs onto beneficiaries through higher premiums or cost-sharing, rather than reducing what patients pay at the pharmacy counter, risks the same trade-off.
We would also oppose extending international reference pricing or MFN-style benchmarks into the commercial market. The same concerns we raise above, regarding the role list prices play in supporting rebates, safety-net programs, and patient assistance, apply with equal or greater force outside Medicare, where these mechanisms are equally embedded in how commercial coverage and cost-sharing function.
Expanding the Number of Negotiated Drugs
We oppose expanding the number of drugs subject to Medicare negotiation particularly since the real-world effects of the IRA’s existing negotiation provisions do not support that patient out-of-pocket costs have been reduced and coverage is maintained. A study published in the Journal of Health Economics and Outcomes Research modeled how PBMs might respond to Medicare’s negotiated prices for two commonly used drugs by shifting patients to a higher copay tier to recoup lost rebate revenue. The study found this could increase patients’ combined out-of-pocket costs by hundreds of millions of dollars annually, lead hundreds of thousands of patients to abandon treatment, and result in tens of thousands of additional major cardiovascular events and deaths.[13] In other words, PBMs may offset the revenue they lose from negotiated prices by shifting more costs onto patients, a pattern that could repeat and grow as more drugs become subject to negotiation. Before expanding the number of drugs negotiated or accelerating negotiation timelines, CMS should be required to monitor total patient out-of-pocket costs, not just wholesale price, for existing negotiated drugs.
Subscription Models
We appreciate your interest in novel payment models. However, the state Hepatitis C subscription models this RFI points to have not worked as well as commonly described, and broadening this approach to other drug classes, carries real risks to patient access, safety-net funding, and innovation.
Louisiana and Washington State both launched subscription-style drug purchasing programs in 2019 and secured meaningful price reductions through competitive bidding, but both states still fell short of their treatment goals. Louisiana, for example, has treated only about 18,500 people out of a 31,000-person target.[14] Lower drug prices did not fix the underlying problems, which included gaps in screening, weak care coordination, and poor outreach to hard-to-reach populations.
This experience points to real risks in expanding subscription models further. Awarding a subscription contract to a single manufacturer secures the lowest price, but it also concentrates the entire supply chain in one source and limits doctors’ ability to prescribe alternative treatments for patients who need them, such as those with drug interactions or other complications. Single-source contracting could also affect innovation more broadly: if manufacturers come to expect this kind of winner-take-all arrangement for future curative therapies, it could discourage the R&D investment needed to bring those cures to market. Splitting the contract across multiple manufacturers preserves choice and supply chain resilience. Subscription programs can also strain safety-net providers if they exclude drugs from 340B pricing, since community health centers rely on that revenue to fund the outreach and patient navigation these programs need to succeed. And subscription models often restrict who is covered, by insurance status, geography, or immigration status, which undermines the public health goal the program is supposed to achieve.
Given this track record, these tradeoffs deserve careful scrutiny before assuming a subscription model will automatically deliver savings or better access for a broader set of conditions.
Section II: Enhancing Prescription Drug Affordability
Out-of-Pocket Caps on Chronic Care Drugs
We strongly support extending Medicare out-of-pocket caps beyond insulin to other chronic, life-threatening conditions that require high-cost, lifelong specialty medications, including HIV and hepatitis. Continuous, uninterrupted access to antiretroviral therapy is essential to maintaining viral suppression, preventing disease progression, and preventing onward transmission; when people living with HIV achieve and maintain viral suppression, they protect both their own health and public health. Cost-sharing has a direct effect on treatment continuation. In a 2022 CDC survey, 34 percent of people with HIV who had stopped taking antiretroviral therapy cited money or insurance problems as a contributing factor.[15]
This RFI raises two distinct types of cost-sharing protection, and we support extending both to our community:
The first is a chronic care copay cap, similar to the existing $35 monthly cap on insulin, a fixed limit on what a patient pays for a specific category of drugs each month. Antiretroviral therapies and direct-acting antiviral hepatitis medications should be included among the drug categories eligible for this kind of cap. We would recommend an overall monthly cap structure across all qualifying chronic care drugs, rather than a separate cap for each individual drug, given that many patients in our community manage multiple concurrent chronic conditions requiring several specialty medications at once.
The second is the annual out-of-pocket maximum, the total ceiling on what a beneficiary pays for covered drugs in a given year, after which the plan covers the full cost. Medicare now caps this annual total at $2,100 in Part D but no equivalent annual maximum exists for Part B, where several of the newest antiretroviral formulations, including long-acting injectable and infused options, are administered; beneficiaries in Part B can instead face cost-sharing of up to 20 percent of the drug’s cost with no annual ceiling at all. This gap is especially consequential for people with HIV because, unlike in commercial insurance, manufacturer copay assistance cannot be applied to either Part B or Part D cost-sharing, leaving Medicare beneficiaries with fewer tools to offset these costs than patients with private coverage. We support the RFI’s proposal to extend an out-of-pocket maximum to Traditional Medicare (Parts A and B), and would urge that any such cap account for these newer treatment modalities.
Relatedly, we support strengthening the Medicare Prescription Payment Plan (MPPP), which lets beneficiaries spread their annual out-of-pocket drug costs into monthly payments rather than paying them at the pharmacy counter. This program is especially valuable for people with HIV and hepatitis, who often reach their annual out-of-pocket maximum in the first fill of the year given the cost of lifelong specialty regimens. Uptake of MPPP has been low relative to its potential, due to low awareness, a notification threshold based on a single prescription’s cost rather than cumulative annual costs, and an enrollment process that requires phone or mail rather than allowing enrollment at the pharmacy counter or through Medicare.gov. We recommend that CMS, rather than individual plans, administer the program directly, which would create a single, consistent enrollment experience for beneficiaries regardless of plan. We also recommend lowering the notification threshold, calculating it based on cumulative annual costs rather than a single prescription, and allowing beneficiaries to opt in at the point of sale.
Net-Price-Based Cost-Sharing
We strongly support basing Medicare Part D patient cost-sharing on the drug’s net price, not its list price, in the deductible phase and whenever coinsurance applies. A 2025 USC Schaeffer Center study found that many Medicare Advantage drug plans (MA-PDs), which used to charge flat copays with no deductible, switched to charging patients a percentage of the list price (coinsurance) once the new $2,000 out-of-pocket cap took effect in 2025.[16] For Eliquis, a commonly used blood thinner, that shift meant patients paid $39 to $46 a month under a flat copay, but $92 to $121 a month under coinsurance, more than double, for the same drug. This gap between what patients pay based on list price and what plans actually pay based on net price is getting worse, not better. Because coinsurance ties what patients pay to the list price rather than the discounted price plans actually pay, this trend will keep costing patients more unless cost-sharing itself is based on net price.
We also support moving to a net-price cost-sharing standard across commercial insurance as we noted in our comments on the FTC’s proposed settlement with Express Scripts.[17]
Inappropriate Pharmacy Rejections
We strongly support holding Part D plans and PBMs accountable for inappropriate pharmacy rejections. Although Medicare prohibits prior authorization for antiretroviral drugs, they are not always enforced and people living with HIV frequently rely on other medications to manage comorbidities, and hepatitis therapies do not receive the same protection. We urge policymakers to ensure the continuation of Medicare’s six protected classes policy, which guarantees this kind of formulary access for antiretroviral therapy and other essential medications used to treat complex, chronic conditions. Patients may also encounter rejections arising from formulary exclusions, quantity limits, refill restrictions, and other utilization-management requirements. These barriers can cause treatment interruptions, delay clinically appropriate care, and undermine medication adherence.
In our June 2026 comments to CMS on its proposed interoperability and drug prior-authorization rule, we offered multiple recommendations addressing prior authorization across the federal health programs and drug benefits covered by that rule.[18] Consistent with those comments, we support the proposals identified in this RFI to incorporate an appropriately designed pharmacy-rejection measure into Part D Star Ratings, make plan-level rejection rates available through Medicare Plan Finder, and simplify the Part D exceptions and appeals process. These policies would give beneficiaries greater visibility into plans’ access performance and help reduce delays in obtaining clinically appropriate medications.
Section III: Bolstering Biopharmaceutical Innovation
Enhancing Investments in Drug Research & Development
Continued investment in basic and translational research is inseparable from the long-term goal of a functional cure for HIV and continued progress toward eliminating hepatitis B and C as a public health threat. Recent funding disruptions illustrate how quickly this progress can stall. In 2025, NIH terminated 191 HIV-specific grants, cutting more than $200 million,[19] and cut off future funding for its two leading HIV vaccine research programs at Scripps Research and Duke University. Each program had been receiving a $129 million grant over seven years, and NIH’s decision meant neither could be renewed when the grants ended in June 2026.[20] These programs have been described as advancing some of the field’s most closely watched experimental HIV vaccines into clinical trials. The cuts have also reached patients directly: a federally funded PrEP trial focused on Black and Hispanic men was halted in the middle of enrolling patients in 2025,[21] and the national research network that coordinates HIV/AIDS clinical trials for adolescents was shut down for a period before its funding was restored.[22] Government price controls and sustained reductions in manufacturer revenue can also affect long-term investment decisions in research areas, like HIV and hepatitis B, that depend on decades of continuous investment in long-acting therapies and cure research. Any new incentives for basic research, translational science, and clinical trials should explicitly account for the unique, decades-long timelines associated with cure and vaccine research in these disease areas. Given these recent losses, we urge policymakers to prioritize restoring and protecting funding for HIV and hepatitis research specifically, including vaccine and cure research, as any new research funding mechanisms are developed.
Conclusion
We thank the Senate Finance Committee Democrats for the opportunity to weigh in on this RFI and for the depth of work reflected in it. We hope to serve as a resource as you continue considering these important issues. If you have any questions or need any additional information, please do not hesitate to reach out to our Government Affairs Director, Zach Lynkiewicz, at zlynkiewicz@hivhep.org.
Sincerely,
Carl E. Schmid II
Executive Director
cc: The Honorable Catherine Cortez Masto
The Honorable Peter Welch
The Honorable Ruben Gallego
[1] Hyle EP, Ang L, Luu G, et al. “Costs associated with increasing numbers of Medicare beneficiaries with HIV aged 65 years and older from 2026 to 2035.” medRxiv. December 27, 2025. https://www.medrxiv.org/content/10.64898/2025.12.19.25342703v1.
[2] Elizabeth Williams, Recent Trends in Medicaid Outpatient Prescription Drugs and Spending, KFF (Mar. 12, 2026), https://www.kff.org/medicaid/recent-trends-in-medicaid-outpatient-prescription-drugs-and-spending/.
[3] Health Resources and Services Administration (HRSA), 340B Drug Pricing Program: Covered Entity Purchases, 2025. https://www.hrsa.gov/opa/updates/2025-340b-covered-entity-purchases
[4] Kristi Martin, “What Pharmacy Benefit Managers Do, and How They Contribute to Drug Spending” (explainer), Commonwealth Fund, Mar. 17, 2025. https://doi.org/10.26099/fsgq-y980.
[5] National Alliance of State and Territorial AIDS Directors. 2025. 2025 National RWHAP Part B ADAP Monitoring Project Annual Report: Table 18, Major FY2024 ADAP Budget Categories Compared with FY2023. 2026. https://nastad.org/sites/default/files/2026-02/2026-adap-report-table-18.pdf.
[6] IQVIA Institute for Human Data Science, The Use of Medicines in the United States 2024. https://www.iqvia.com/insights/the-iqvia-institute/reports-and-publications/reports/the-use-of-medicines-in-the-us-2024.
[7] Funders Concerned About AIDS. 2026. Philanthropy’s Response to HIV and AIDS: 2024 Grantmaking. February 2026. https://www.fcaaids.org/wp-content/uploads/2026/02/FCAASupportReport24_v4-abb.pdf.
[8] Yahoo Finance UK. 2025. “Bread Price Shock: What Brits Pay Compared to Other Countries.” February 25, 2025. https://uk.finance.yahoo.com/news/bread-price-shock-brits-pay-130000802.html.
[9] National Council on Disability. (2019). Quality adjusted life years and disability discrimination: An analysis of the disabilities addendum to the life-years lost methodology (Report). https://www.ncd.gov/assets/uploads/reports/2019/ncd_quality_adjusted_life_report_508.pdf.
[10] 90 FR 60338.
[11] Fusco N, Sils B, Graff JS, Kistler K, Ruiz K. Cost-sharing and adherence, clinical outcomes, health care utilization, and costs: A systematic literature review. J Manag Care Spec Pharm. 2023 Jan;29(1):4-16. doi: 10.18553/jmcp.2022.21270. Epub 2022 Apr 7. PMID: 35389285; PMCID: PMC10394195. https://doi.org/10.18553/jmcp.2022.21270.
[12] Greenwalt, L. (2021, November 30). Understanding the impact of cost sharing in pharma: Cost is a powerful control of patient behavior. IQVIA. https://www.iqvia.com/locations/united-states/blogs/2021/11/understanding-the-impact-of-cost-sharing-in-pharma.
[13] Sydor AM, Rivera E, Popovian R. “Could the Inflation Reduction Act Maximum Fair Price Hurt Patients?” Journal of Health Economics and Outcomes Research. 2024;11(2):154-160. https://doi.org/10.36469/001c.125251.
[14] Roebuck MC, Schmid CE II. “The Cure Hepatitis C Act of 2025: Critical Questions and Policy Design Considerations,” Health Affairs Forefront, December 12, 2025. https://www.healthaffairs.org/content/forefront/cure-hepatitis-c-act-2025-critical-questions-and-policy-design-considerations.
[15] Panel on Antiretroviral Guidelines for Adults and Adolescents, “Cost Considerations and Antiretroviral Therapy,” in Guidelines for the Use of Antiretroviral Agents in Adults and Adolescents with HIV (U.S. Department of Health and Human Services), accessed July 28, 2026, https://clinicalinfo.hiv.gov/en/guidelines/hiv-clinical-guidelines-adult-and-adolescent-arv/antiretroviral-therapy-cost-considerations.
[16] Karen Van Nuys, Erin Trish, et al., “Shifting Cost-Sharing Burden to Beneficiaries in Medicare Part D,” USC Schaeffer Center for Health Policy & Economics, June 19, 2025, https://schaeffer.usc.edu/research/cost-sharing-burden-medicare-part-d/.
[17] HIV+Hepatitis Policy Institute, Letter to the FTC on the Proposed Settlement with Express Scripts, Mar. 13, 2026. https://hivhep.org/testimony-comments-letters/letter-to-the-ftc-in-support-for-and-recommendations-on-proposed-settlement-with-express-scripts/.
[18] HIV+Hepatitis Policy Institute, Comments to Administrator Oz on the CMS Proposed Rule on Interoperability Standards and Prior Authorization for Drugs, June 15, 2026, https://hivhep.org/testimony-comments-letters/comments-to-administrator-oz-on-the-cms-proposed-rule-on-interoperability-standards-and-prior-authorization-for-drugs/.
[19] AVAC, “HIV Research & Development at Risk: Tracking the Impact of US Funding Cuts,” 2025, https://avac.org/wp-content/uploads/2025/05/HIVresearchDevelopmentAtRisk.pdf.
[20] Jon Cohen, “‘Devastating’: NIH Cancels Future Funding Plans for HIV Vaccine Consortia,” Science, May 30, 2025, https://www.science.org/content/article/devasting-nih-cancels-future-funding-plans-hiv-vaccine-consortia.
[21] Rachel Roubein and Sarah Owermohle, “Hundreds of Clinical Trials Affected by NIH Funding Cuts, New Study Finds,” The Washington Post, November 17, 2025, https://www.washingtonpost.com/health/2025/11/17/clinical-trials-nih-funding-cuts/.
[22] Kelly Servick, “NIH Grant Cuts Have Disrupted Hundreds of Clinical Trials, Study Finds,” Fierce Biotech, December 1, 2025, https://www.fiercebiotech.com/research/nih-grant-cuts-have-disrupted-hundreds-clinical-trials-study-finds.