CMS extends deadline for MFN pricing pilot scheme
CMS Administrator Mehmet Oz.
The Centers for Medicare & Medicaid Services (CMS) in the US has extended the deadline for companies to take part in its GENEROUS pilot programme, designed to implement Most-Favoured Nation (MFN) pricing for outpatient drugs reimbursed by Medicaid.
The agency has pushed back the deadline for participation in the scheme from the end of this month to 30th April, leading to speculation that it may be struggling to find companies willing to take part.
In an update, CMS said the extension will "provide interested drug manufacturers more opportunity to join the model," adding that it will hold meetings with interested manufacturers from the start of April and plans to hold a town hall meeting to discuss the operational and methodological details of the model later this spring.
However, the final deadline for participation will remain unchanged at 30th June, according to the CMS, which is seeking small- and mid-sized company volunteers.
First announced last November, GENEROUS (GENErating cost Reductions fOr US Medicaid) is a voluntary scheme that invites pharma companies to negotiate standardised coverage criteria for each of their products with Medicaid, avoiding the need to negotiate access deals in every state separately.
In simple terms, drugmakers will get uniform coverage across all participating Medicaid programmes in return for setting the prices of medicines provided by Medicaid in the US to the lowest charged for them in eight reference countries, specifically the UK, France, Germany, Italy, Canada, Japan, Denmark, and Switzerland.
"Based on feedback from drug manufacturers, CMS has decided to give interested companies additional time to apply for the GENEROUS Model," commented CMS Administrator Mehmet Oz.
"We are committed to partnering with states and manufacturers to drive down drug prices and ensure that the most vulnerable Americans have access to life-saving medications."
Since GENEROUS was first announced, commentators have expressed concern that the pricing model could discourage some manufacturers from offering certain drugs through Medicaid, which provides health insurance for Americans with limited income and resources.
A letter (PDF) written by more than 150 economists to HHS last year said that MFN policies – which are also being applied to Medicare by the Trump administration – risk reducing patient access to medicines, cutting investment in industry R&D, and cost-shifting that raises the prices of other medicines.
Centre-right political think-tank, the American Action Forum, argued in a recently-published analysis that participating in GENEROUS would be a "poor business decision" for drugmakers, saying it is unclear "how these rebates would compare to payments already in place and if this new approach will undermine preferred drug lists."
CMS has pointed out that the cost of Medicaid spending on prescriptions in 2024 – at $100 billion, or $60 billion after manufacturer rebates – was a $10 billion increase on the prior year and underscores the "urgency for reform."
