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WASHINGTON — Venture capitalists are still pouring money into drug research in spite of Medicare’s new power to negotiate drug prices, according to Congress’ nonpartisan budget experts.
The Inflation Reduction Act includes two measures that directly lower drug prices. Medicare price negotiation is the most controversial of the two. The law gives drugs 9 years on the market before negotiated prices take effect; biologics get 13 years. Drugs are selected for negotiation among the 50 top-selling drugs without generic or biosimilar competition. Medicare will negotiate prices for 10 drugs to start. Up to 60 drugs will be subject to negotiation over the next four years, and up to 20 more drugs every year afterward.
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The law also requires drug companies to pay back Medicare when they raise prices on drugs faster than inflation.
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