NHC Responds to CMS Information Collection Request on Drug Price Negotiation

NHC Responds to CMS Information Collection Request on Drug Price Negotiation

August 29, 2025

Mehmet Oz, MD, MBA
Administrator
Centers for Medicare & Medicaid Services
Department of Health and Human Services
7500 Security Boulevard
Baltimore, MD 21244

RE: Drug Price Negotiation for Initial Price Applicability Year 2028 under Sections 11001 and 11002 of the Inflation Reduction Act (IRA) Information Collection Request (ICR) Forms [CMS-10849, OMB 0938-1452]

Dear Administrator Oz:

The National Health Council (NHC) appreciates the opportunity to comment in response to the Drug Price Negotiation for Initial Price Applicability Year 2028 under Sections 11001 and 11002 of the Inflation Reduction Act (IRA) Information Collection Request (ICR) Forms (the ICR).

Created by and for patient organizations over 100 years ago, the NHC convenes organizations from across the health ecosystem to forge consensus and drive patient- centered health policy. We promote increased access to affordable, high-value, comprehensive, accessible, and sustainable health care. Made up of more than 180 national health-related organizations and businesses, the NHC's core membership includes the nation's leading patient organizations. Other members include health- related associations and nonprofit organizations including the provider, research, and family caregiver communities; and businesses and organizations representing biopharmaceuticals, devices, diagnostics, generics, and payers.

General Comments

The NHC acknowledges CMS' efforts to design a fair and transparent data collection process that facilitates patient-centered drug price negotiations. It is imperative that the forms and accompanying instructions reflect a balance between completeness, consistency, and administrative feasibility. The process must be sufficiently rigorous to ensure meaningful and reliable data collection, while retaining the flexibility necessary to accommodate a broad range of stakeholders, including patients, caregivers, manufacturers, and researchers.

The NHC emphasizes three overarching principles applicable across all sections of the ICR:

1. Transparency is essential to public Patients and taxpayers must be able to understand how data are used and how decisions are made.1
2. Consistency in reporting is critical to supporting valid comparisons across products, mitigating administrative burden, and improving the reliability of negotiated outcomes.2
3. Patient-centeredness must remain the central objective. Every data element- whether related to manufacturer costs, clinical alternatives, or revenue-should ultimately serve the goal of ensuring that Medicare beneficiaries are able to access clinically appropriate therapies without undue financial burden.3

The NHC acknowledges the statutory timelines and operational complexity inherent in this multi-stakeholder process and encourages CMS to adopt strategies that reduce unnecessary burden, facilitate participation from a broad range of contributors, and provide clarity regarding how each data element will be used in price determinations. A transparent and predictable framework will enhance stakeholder trust and support the program's long-term credibility and success.

Section-By-Section Comments

The following technical and policy-focused recommendations are intended to help CMS refine the ICR in alignment with statutory intent, patient-centered objectives, and the program's broader commitment to affordability, sustainability, and innovation. Each section comment is designed to improve clarity, consistency, and operational feasibility, while ensuring that the data collection framework reflects the perspectives and needs of all stakeholders, including patients, caregivers, providers, manufacturers, payers, and the broader health system.

Section A: Selected Drug Information

The NHC acknowledges CMS' decision to prepopulate Section A with National Drug Codes (NDC-11s) and associated identifiers, recognizing this as an important measure to improve consistency and reduce variation across manufacturer submissions.

However, the accuracy of this prepopulation process is of paramount importance, as discrepancies or omissions may result in downstream consequences that adversely affect patient access. Specifically, errors in the NDC list may lead to reimbursement inconsistencies, inappropriate claims denials, or delays in therapy initiation.4

To mitigate these risks, CMS should consider establishing a transparent and time- bound error correction protocol that clearly outlines the process by which manufacturers may dispute or supplement CMS-populated data. This process should include defined timelines for review and adjudication and should be publicly documented to ensure predictability. The absence of such a mechanism could shift the burden of administrative inaccuracies onto patients and providers.

Further clarification is warranted regarding the treatment of discontinued NDCs, sample packages, and private-label distributions. Although manufacturers are required to report these data, the implications for Maximum Fair Price (MFP) calculations remain unclear. For example, the inclusion of discontinued NDCs may create uncertainty for providers regarding reimbursement status and coverage eligibility. To address these concerns, CMS should issue explicit interpretive guidance, supplemented by illustrative examples, to promote consistent treatment across Medicare Administrative Contractors.

Finally, the NHC encourages CMS to provide beneficiaries and caregivers with a plain- language explanation of the NDC selection methodology. Transparent communication regarding which product formulations are subject to the MFP-and why certain versions are excluded-will be critical to preventing confusion at the point of care, whether at the pharmacy counter or in a clinical setting. Improved patient-facing transparency will be essential as Medicare beneficiaries navigate the implementation of this new pricing framework.

Section B: Non-FAMP Data Collection

The NHC recognizes that the collection of non-Federal Average Manufacturer Price (non-FAMP) data is a statutory requirement under the IRA and acknowledges its value as a baseline metric for evaluating manufacturer pricing behavior. However, non-FAMP figures, in isolation, offer limited insight into the actual financial impact experienced by Medicare beneficiaries.5 The prices patients encounter at the pharmacy counter or point of care are shaped by a complex interplay of factors, including formulary tiering, coinsurance levels, utilization management policies, and site-of-care billing structures.6

Accordingly, the NHC urges CMS to clearly articulate the role non-FAMP data will play in negotiation determinations, particularly in relation to other data sources that reflect real-world access and affordability. CMS should ensure that its interpretation of non- FAMP is contextualized within this broader framework. Clarification on how these values will be weighed-particularly in relation to patient cost-sharing and access barriers-will enhance the integrity and credibility of the negotiation process.

Furthermore, the reliability of non-FAMP data may vary across product types. For therapies introduced after 2021, or those with non-continuous NDC marketing histories, reported non-FAMP values may be limited in scope or influenced by anomalous pricing periods.7 Estimates may also vary depending on whether data are derived from direct sales or public pricing reports.8 To bolster analytical rigor and stakeholder confidence, CMS should consider implementing a review process that compares reported non- FAMP values to additional pricing benchmarks where appropriate-such as Wholesale Acquisition Cost (WAC), Average Sales Price (ASP), or commercial net pricing data, when available. CMS could further improve transparency by publishing anonymized, aggregated summaries of how these comparisons informed the agency's evaluation.

Finally, the NHC underscores the importance of addressing discrepancies between Primary and Secondary Manufacturer data submissions. Variances between these sources may introduce uncertainty into the negotiation process and pose administrative challenges for downstream stakeholders, including providers and pharmacies. CMS should develop reconciliation protocols to resolve such inconsistencies, including specific timelines and criteria for determining the authoritative data source. Technical guidance to manufacturers on expected standards for non-FAMP reporting would also help promote consistency and reduce the risk of access delays for beneficiaries.

Section C: Research and Development (R&D) Costs and Recoupment

The NHC acknowledges that R&D cost and recoupment analyses can contribute valuable context to drug price negotiations. However, the NHC emphasizes that such data must not displace considerations that center on the patient experience, including affordability and timely access to clinically appropriate treatments. Methodologies for estimating R&D expenditures differ widely across companies, and attributing development costs to a single therapy-particularly when research is shared across platforms, therapeutic areas, or programs-presents significant methodological challenges.9

To enhance transparency and consistency, the NHC recommends that CMS request manufacturers to include a general description of the methodologies and key assumptions used in allocating R&D costs, consistent with industry norms and proprietary protections. CMS should also publish de-identified, aggregated summaries of these disclosures to provide stakeholders with insight into the agency's approach.

Doing so would help avoid undue emphasis on opaque or non-standardized accounting practices, which may vary by company size, portfolio structure, or internal reporting policies.

Recoupment analyses should also be carefully balanced against the IRA's overarching goal of ensuring affordable access to high-value therapies. Policies that rely excessively on manufacturer-reported cost recovery risk disincentivizing future investment in areas with high scientific or operational risk, including treatments for rare diseases, pediatric conditions, or less commercially attractive therapeutic areas.10 CMS should therefore evaluate recoupment data in conjunction with other patient-centered inputs-such as measures of clinical benefit, patient-reported outcomes, adherence patterns, and improvements in quality of life.

Where public funds have supported the development of a therapy-through direct grants, tax incentives, or public-private partnerships-CMS should consider this investment in a manner that recognizes the shared value created by such collaborations. Public contributions to R&D have helped catalyze transformative innovations, and it is appropriate that pricing decisions reflect both the public's investment and the importance of preserving incentives for future research. CMS should adopt a standardized approach for assessing the role of prior federal support in drug development, ensuring that this factor is applied transparently and consistently across products.

Question 1: Costs Related to the Selected Drug. The NHC supports CMS' effort to collect detailed information on pre-clinical research, post-Investigational New Drug development, and other allowable R&D expenditures. However, to ensure comparability across products and manufacturers, companies should be required to document their methodologies for allocating indirect costs, clearly delineate direct costs, and provide sufficient justification for proportional or other allocation methods. Where indirect costs are distributed across multiple products or divisions, the total pool and rationale for allocation should be disclosed. Similarly, inflation adjustments should be based on a transparent, standardized methodology, with manufacturers identifying the indices used, detailing any assumptions, and providing sufficient information to support external validation. While this information may provide useful background for negotiation, it should remain one of several considerations, subordinate to patient- centered factors such as unmet need, real-world impact, and affordability.

Question 2: Costs of Failed or Abandoned Products. The NHC recognizes that investment in failed or abandoned products is an intrinsic aspect of pharmaceutical innovation and supports CMS' inclusion of this information in the ICR. To enhance the interpretability of these data, manufacturers should be asked to explain the connection between these abandoned programs and the selected drug, including the stage of development, therapeutic target, and reasons for termination. This level of detail can help illuminate research trajectories and portfolio management strategies. However, CMS should exercise caution in applying these figures during negotiation. While relevant to understanding the broader investment landscape, they do not represent direct costs associated with bringing a single therapy to market and may risk distorting value assessments if given disproportionate weight. The primary use of these disclosures should be to inform CMS' understanding of development risk and market dynamics, rather than as a standalone justification for pricing outcomes.

Question 3: Global and U.S. Net Revenue for the Selected Drug. The NHC supports the collection of both U.S. and global net revenue data, as this information is essential to contextualizing cost recovery and informing price negotiation. To promote uniformity and reliability, CMS should require manufacturers to specify the methodologies used to calculate net revenue, including the treatment of chargebacks, discounts, rebates, returns, and other commercial arrangements. Particular care should be taken to distinguish between cash and non-cash transactions. U.S. net revenue should serve as the primary data point in Medicare negotiations, with global revenue providing supplemental context. CMS should also request disclosure of relevant exchange rates, inflation adjustments, and reporting timeframes to ensure cross- manufacturer consistency. Where appropriate, CMS may wish to publish anonymized, aggregated summaries of revenue data to demonstrate how these inputs align with broader statutory objectives of sustainability, value, and beneficiary access.

Section D: Current Unit Costs of Production and Distribution

CMS' inclusion of questions related to the current unit costs of producing and distributing selected drugs reflects the need for greater transparency into the underlying economic drivers of pricing. While unit cost data alone do not capture the full complexity of pharmaceutical pricing, they are a necessary input for evaluating whether the price of a product is reasonably aligned with its manufacturing and supply chain expenditures.

To ensure that these data support meaningful comparisons across products and therapeutic areas, CMS must establish clear definitions, promote consistency in reporting, and account for factors that may introduce variability-such as batch size, formulation differences, or distribution models. The following comments are intended to support the integrity and interpretability of this section.

Question 4: Per Unit Production and Distribution Costs. The NHC supports CMS' collection of per-unit production and distribution costs for each NDC-11 associated with a selected drug. When collected and applied appropriately, this data can serve as a useful reference point to assess whether pricing claims reasonably reflect underlying cost structures. However, production cost data must be gathered and analyzed in a manner that ensures consistency, transparency, and comparability across manufacturers and dosage forms. Without standardized methodologies, cost submissions may vary significantly depending on internal accounting practices, rendering cross-manufacturer comparisons unreliable.

To that end, CMS should consider requiring manufacturers to use a consistent framework for calculating per-unit costs, including clear definitions of cost categories and allocation principles. Particular attention should be paid to how shared or indirect expenses-such as administrative overhead, facility operations, depreciation, and other fixed costs-are attributed across product lines and NDCs. These inputs should be described in a manner that allows CMS to determine whether allocations are reasonable and whether costs have been overstated in ways that could distort price justification.

The inclusion of discontinued NDCs and sample packages may also provide useful insight into a product's lifecycle and historical pricing practices. However, CMS should clarify how such data will be factored into pricing determinations. Without clear guidance, ambiguity around the treatment of these units could introduce unnecessary administrative burdens or delay claims processing. While production and distribution cost data are important for understanding market dynamics, they do not represent the price patients ultimately face. CMS should therefore treat this information as a contextual reference-useful in detecting implausible or inflated cost assertions-but not as a primary determinant of negotiated price. Affordability, access, and clinical value must remain the guiding principles.

Question 5: Explanation of Calculation of Per Unit Production and Distribution Costs. The NHC underscores that the contextual narrative accompanying per-unit cost data is equally essential to interpreting the figures accurately and meaningfully. To support transparency and comparability, CMS should require manufacturers to provide a detailed explanation of how production and distribution costs were calculated. This should include a breakdown of direct inputs-such as raw materials, labor, quality assurance, logistics, packaging, and labeling-as well as any indirect costs attributed to the product. Where indirect costs are allocated across NDCs or product lines, the methodology for allocation should be clearly described and justified.

In addition, manufacturers should specify whether production and distribution costs were incurred domestically or internationally, distinguishing between the two in reporting. Capital expenses-including facilities and equipment-should be identified and accompanied by the depreciation methodology used. For sample units, manufacturers should describe their production process and cost basis, including whether these units were manufactured on dedicated lines or as part of general production.

To promote consistency, CMS may wish to establish uniform standards for inflation adjustment and cost indexing. Requiring manufacturers to cite the indices used and to explain any assumptions will improve the reliability of the data. Where feasible, CMS should also consider publishing anonymized, aggregated descriptions of submitted methodologies. This would allow stakeholders to better understand industry practices without compromising proprietary business information.

In all cases, the NHC reiterates that production and distribution costs should be treated as one of many contextual factors in the negotiation process. While relevant to assessing reasonableness, these figures should not serve as a standalone basis for determining the MFP. Ultimately, what matters is whether beneficiaries can obtain medically necessary therapies at a cost that does not undermine adherence, outcomes, or financial stability.

Section E: Prior Federal Financial Support

Understanding the extent of prior federal financial support for the development of selected drugs is critical to assessing public investment in innovation. This includes not only direct grant funding but also indirect forms of support such as federally funded research infrastructure, public-private partnerships, and regulatory assistance.

Transparent reporting in this section can help CMS determine whether taxpayer-funded contributions played a substantive role in the drug's discovery, development, or commercialization. To ensure accurate and consistent responses, CMS should provide clear guidance on what qualifies as relevant federal support and require sufficient detail to contextualize the public's role in advancing the therapy.

Question 6: Federal Funding Support Amount. The NHC supports CMS' inclusion of prior federal financial support as a required data element in the negotiation process. Transparency regarding these contributions-such as grants from the National Institutes of Health, Biomedical Advanced Research and Development Authority contracts, and Orphan Drug tax credits- ensures that the public's role in enabling drug development is appropriately reflected in price-setting decisions. The framework should incorporate these data in a manner that strengthens accountability while preserving incentives for continued investment in therapies that address unmet medical needs.

To improve fairness and interpretability, CMS should require manufacturers to report material forms of federal support-such as direct grants, cooperative agreements, tax credits, and federal contracts-associated with the development of the selected product. Where feasible, manufacturers should also disclose significant in-kind support, including access to federal laboratories or technical expertise, and provide explanatory context. To promote consistency and accuracy, CMS should clarify whether disclosures must be limited to support directly tied to the marketed product or whether broader R&D contributions should be included, particularly in cases where shared infrastructure or platform research was involved.

This level of detail will help CMS and other stakeholders understand the scope and relevance of public contributions to the selected drug's development, while promoting fair outcomes for Medicare beneficiaries and the broader public.

Question 7: Explanation of Calculation of Federal Financial Support. The NHC emphasizes that narrative explanations accompanying reported federal support figures are essential to establishing their relevance, accuracy, and comparability.

Manufacturers should be expected to provide disaggregated reporting by source of funding, including award numbers, dates, and associated programmatic details when available. Such transparency would allow validation against publicly available federal databases and provide greater assurance that reported figures accurately reflect the federal government's contributions.

Where indirect costs or shared research infrastructure were supported by federal funds, the methodology for apportioning these costs to the selected product should be clearly described. Similarly, for in-kind support or cooperative agreements, CMS should require a description of the valuation methods used, including assumptions and allocation principles. While Section E does not require inflation adjustments for Question 6, CMS may wish to request that manufacturers indicate whether inflation-adjusted figures are included in Question 7 to support consistent interpretation across submissions.

These measures would strengthen the integrity of the negotiation process by ensuring that federal support is not only disclosed but also contextualized appropriately within manufacturers' pricing justifications.

Question 8: Agreements Between Primary Manufacturer and Federal Government. The NHC supports the requirement that manufacturers disclose any relevant agreements with federal agencies, including those related to licensing, purchasing, pricing, and other negotiated terms. These agreements may include preferential pricing arrangements, volume-based purchase commitments, or negotiated terms under programs such as the Federal Supply Schedule. Transparent disclosure of such agreements can help ensure that Medicare beneficiaries are not disadvantaged relative to other federally supported programs.

To support this goal, manufacturers should be required to describe the key terms of these agreements, including exclusivity provisions, applicable price or volume thresholds, effective dates, and expiration timelines. In cases where an agreement encompasses platform technologies, multi-drug pipelines, or broader supply arrangements, manufacturers should explain how the selected drug fits within the scope of such contracts. Additionally, CMS should clarify whether pricing or purchasing terms that apply to other federal programs are also relevant in the context of Medicare negotiations.

To balance transparency with protection of proprietary business information, CMS could consider publishing anonymized, aggregate summaries of the nature and scope of disclosed agreements. This would reinforce public trust that federal contributions are appropriately factored into pricing determinations while preserving the integrity of confidential contractual arrangements.

Section F: Patents, Exclusivities, and Approvals

Patent protections and regulatory exclusivities can significantly influence drug pricing and availability. This section addresses the intellectual property and market exclusivity landscape surrounding the selected drug, as well as the presence or absence of generic or biosimilar competition. A clear understanding of these elements is essential for evaluating the manufacturer's pricing leverage, market dynamics, and the duration of monopoly pricing. CMS should ensure that the questions in this section elicit precise, well-documented information on patent scope, expiration dates, exclusivity types, and any current or anticipated generic entry, so that negotiation decisions are grounded in a full understanding of competitive context.

Questions 9A and 9B: Patents and Patent Applications. The NHC supports CMS' collection of detailed information on both granted patents and pending patent applications related to selected drugs. Patent protections are a central determinant of market exclusivity and the timing of generic or biosimilar competition-factors that have a direct and often prolonged impact on patient access and affordability. A clear and comprehensive understanding of the patent landscape is essential to ensure that pricing negotiations are grounded in an accurate representation of market barriers.

CMS should require manufacturers to list all granted patents and publicly available patent applications associated with the selected drug and to categorize them by type (e.g., composition of matter, method of use, formulation, delivery device). This structured classification will help CMS better understand the nature and scope of exclusivity protections while allowing for consistency across manufacturer submissions.

While certain secondary patents may reflect meaningful therapeutic enhancements- such as improved safety, tolerability, or patient adherence-others may have more limited implications for clinical benefit. To support a balanced and informed negotiation process, CMS should consider requiring manufacturers to disclose relevant patent ownership information, particularly in cases involving joint ventures, licensing arrangements, or technologies arising from federally supported research. Increased transparency in this area would help ensure that the role of public investment in innovation is appropriately recognized.

In addition, CMS should examine the role of pending patent applications in shaping future market dynamics. Although such applications are often confidential, manufacturers should be expected to disclose the general subject matter, intended therapeutic benefit, and potential market implications of active filings. This information may assist CMS in assessing whether the timing of potential generic or biosimilar entry is likely to be affected by unresolved patent protections.

Question 10: Exclusivity Periods. The NHC agrees with CMS that exclusivity periods conferred by the FDA represent an important component of the overall pricing landscape. Statutory exclusivities-including those granted under Hatch-Waxman, the Biologics Price Competition and Innovation Act (BPCIA), and the Orphan Drug Act- play a legitimate role in incentivizing innovation, particularly for rare conditions or populations with limited treatment options. Overlapping or sequential exclusivity periods may provide important assurances that help justify investment in high-risk or low-return therapeutic areas.

However, the cumulative effect of these protections-particularly when combined with other forms of intellectual property protection-may result in extended periods of market exclusivity. While such exclusivity can serve an important role in encouraging private investment and supporting the development of innovative therapies, particularly in high- risk or underserved areas, it is also important to ensure that these protections do not unnecessarily delay the entry of generics or biosimilars. CMS should evaluate how the interaction of exclusivity provisions and intellectual property protections may affect competition over time and consider whether the resulting timelines appropriately balance incentives for innovation with timely and affordable access for patients.

CMS should request that manufacturers disaggregate exclusivity periods by type and duration and clarify how each interacts with the patent landscape. For example, when a drug holds both Orphan Drug Exclusivity and a method-of-use patent, it would be useful to understand how those protections function together to affect the availability of generics or biosimilars. CMS may also wish to require disclosure of whether exclusivity protections apply to the core indication or only to supplemental approvals, as this distinction has implications for both pricing and patient access.

By encouraging greater transparency regarding the structure and duration of exclusivity protections, CMS can better assess whether these mechanisms are serving their intended purposes to support timely access to affordable therapies.

Question 11: Active and Pending FDA Applications and Approvals. The NHC supports CMS' proposal to collect information on active and pending FDA applications related to selected drugs, as these data can provide important insight into lifecycle management activities that may influence pricing and exclusivity. CMS should distinguish between applications that offer clinically meaningful improvements-such as enhanced safety, expanded indications for underserved populations, or improved adherence-and those that involve more limited changes, including packaging modifications or minor dosing adjustments. Manufacturers should also be asked to indicate whether pending applications are expected to trigger new exclusivity protections or extend existing ones, particularly when filings occur near the expiration of exclusivity or patent rights. Greater transparency in this area will help ensure that pricing negotiations remain focused on clinical value and patient benefit, rather than regulatory actions that may delay competition without advancing therapeutic outcomes.

Section G: Market Data and Revenue and Sales Volume Data

This section seeks to contextualize a drug's market performance by gathering information on list and net pricing, sales volumes, and revenue across public and private payers. These data elements are central to understanding real-world utilization patterns, pricing behavior, and how the financial burden is distributed across the health care system. CMS must ensure that the information collected under this section is detailed enough to inform negotiation, while also structured to enable meaningful comparisons across drugs, payers, and patient populations. Accurate reporting and careful interpretation of this data can help distinguish between payer savings and patient affordability, reinforcing the program's intent to lower costs for Medicare beneficiaries.

Questions 12 & 13: Wholesale Acquisition Cost (WAC). The NHC supports CMS' collection of WAC data as a foundational benchmark in evaluating pricing dynamics. While WAC does not reflect negotiated discounts or rebates, it remains a central factor in determining patient cost-sharing obligations, particularly for individuals with coinsurance linked to list prices. As such, WAC should not be interpreted solely as a proxy for manufacturer pricing strategy, but rather as a reference point that shapes patient financial exposure at the point of care.

To enhance transparency and utility, CMS could compare manufacturer-reported WAC data against publicly available sources such as First Databank, Medi-Span, or RED BOOK. Any discrepancies should be assessed in terms of their impact on patients, including variations in out-of-pocket costs or coverage determinations. Clear documentation of how WAC values align-or diverge-from other pricing benchmarks would provide additional clarity for stakeholders, including patient organizations and plan sponsors.

Questions 14 & 15: Medicaid Best Price. The NHC affirms the importance of the Medicaid Best Price requirement as a safeguard for preserving affordability for low-income beneficiaries. CMS' continued collection and review of best price data is essential to ensuring that the statutory rebate framework operates as intended. Given the complexity of pharmaceutical contracting, the agency should evaluate whether current reporting captures the full range of price concessions, including those offered through bundled sales, value-based arrangements, and specialty pharmacy networks.

Where discrepancies arise between reported best prices and underlying transaction- level data, CMS should take appropriate steps to verify accuracy and ensure that Medicaid beneficiaries fully benefit from statutory pricing protections. Maintaining integrity in best price reporting is especially critical for high-cost specialty drugs, which represent a growing share of Medicaid prescription spending and may pose significant access barriers if rebate mechanisms are weakened or circumvented.

Questions 16 & 17: Federal Supply Schedule (FSS) Price. The FSS price represents a deeply discounted federal procurement rate, often lower than commercial prices due to statutory discounting requirements. While not directly tied to patient out-of- pocket costs, the FSS price offers a useful reference point for understanding the range of prices manufacturers are willing to accept in other contexts. CMS' review of FSS data can provide insight into broader pricing practices and inform assessments of value in Medicare negotiations.

Where notable gaps exist between FSS and commercial net prices, CMS could explore whether such differences reflect market segmentation, supply chain dynamics, or contracting terms with unique federal obligations. Understanding these distinctions may help contextualize how pricing decisions affect affordability for non-federal populations without conflating separate statutory frameworks.

Questions 18 & 19: Big Four Price. The "Big Four" federal purchasers-the Department of Veterans Affairs, Department of Defense, Public Health Service, and Coast Guard-often secure the most favorable pharmaceutical pricing in the United States through statutory formulas and direct negotiation. CMS' collection of Big Four pricing data offers a valuable comparative lens for examining pricing variability across public programs.

While acknowledging the distinct statutory authorities that govern each federal purchaser, CMS may assess how negotiated prices for the Big Four compare to net prices in Medicare and commercial markets. Where consistent patterns emerge, these comparisons may inform future efforts to strengthen pricing consistency while preserving program-specific statutory protections.

Questions 20 & 21: Manufacturer U.S. Commercial Average Net Unit Price.

Commercial net pricing reflects a complex array of negotiated discounts, formulary placement incentives, and access arrangements. While such mechanisms can lower overall payer expenditures, the benefit to patients is often indirect, particularly when cost-sharing is based on undiscounted list prices. CMS' collection of commercial net price data is therefore essential to understanding how payer-facing savings translate- or fail to translate-into patient-level affordability.

The NHC encourages CMS to request disaggregated data on how rebates, copay assistance, and patient support programs contribute to net price calculations. While patient assistance programs offer temporary relief, they should not substitute for sustainable, systemwide affordability. To evaluate real-world patient impact, CMS should also consider comparing commercial net prices with actual patient out-of-pocket costs across plan designs. Such analysis would support more targeted interventions that improve transparency and fairness in cost sharing.

Questions 22 & 23: Medicare Part D Net Average Unit Price. Medicare Part D net pricing plays a central role in shaping beneficiary access and affordability, particularly for those managing high-cost chronic conditions on fixed incomes.

Differences between "net average unit price" and "net best price" within Part D can obscure underlying variations in manufacturer discounts, especially when program- specific mechanisms such as coverage gap discounts or Manufacturer Discount Program obligations are applied.

To improve visibility, CMS should request additional clarity on how these concessions are structured and whether they result in lower patient spending or merely shift costs among program stakeholders. The NHC urges CMS to interpret Part D net price data with a focus on patient outcomes, particularly whether negotiated discounts reduce actual pharmacy counter costs or are absorbed elsewhere in the system without beneficiary benefit.

Question 24: Proprietary Information Designation. The NHC strongly supports transparency in the price negotiation process and cautions against overbroad classification of market data as proprietary. While the protection of commercially sensitive information is appropriate in limited circumstances, overly broad redaction risks undermining public confidence in the negotiation process and obscuring the very dynamics it seeks to improve.

CMS should narrowly define the scope of proprietary information to exclude only those data elements whose disclosure would result in demonstrable competitive harm.

Aggregated data-such as average net prices by payer segment, unit sales volumes, WAC and list prices, and ranges of rebates or discounts-should be made publicly available, with clear explanations of methodology. CMS should also consider a mechanism for patient and consumer groups to comment on published summaries, ensuring that the program remains anchored in its statutory purpose of improving affordability and access for beneficiaries.

Section I: Evidence About Alternative Treatments

This section is designed to capture information about the clinical and experiential value of therapeutic alternatives to the selected drug, drawing on perspectives from patients, caregivers, clinicians, researchers, manufacturers, and the broader public.

Understanding the availability, effectiveness, and accessibility of these alternatives is essential to evaluating a drug's comparative benefit and identifying unmet needs. CMS should ensure that the structure and content of this section accommodate a wide range of inputs-both qualitative and quantitative-while maintaining transparency and methodological rigor. Facilitating robust engagement across respondent types will help ensure that the full context of therapeutic value is incorporated into price negotiations.

Question 25: Respondent Information. Collecting information on respondent type and organizational affiliation is essential to interpreting submitted data. To further enhance transparency, CMS should consider requiring the disclosure of relevant financial relationships with manufacturers of the selected drug or its comparators, including indirect support. Clear guidance should be provided for respondents with multiple roles-such as patient organizations that also conduct research or engage in industry collaboration-so they can accurately represent their perspective. Patient organizations in particular warrant recognition as a distinct category given their unique role in representing the lived experiences of patients.

Questions 26-31: Patient- and Caregiver-Focused Input. Patient and caregiver perspectives are indispensable to assessing therapeutic value. The NHC commends CMS for including targeted questions in this section. To increase accessibility, CMS could offer structured prompts-such as checkboxes or rating scales-in addition to open-text fields. This approach may reduce barriers for respondents with limited time, English proficiency, or health literacy. These questions should also explicitly invite input on non-clinical challenges that affect patient experience, such as affordability, coverage restrictions, or geographic access limitations. Respondents should be encouraged, though not required, to include demographic or contextual information-such as disability status or rural residence-to inform accurate interpretation of access barriers.

Questions 32-37: Manufacturer-Focused Input. Manufacturers play an important role in contributing comparative evidence and contextualizing unmet need. CMS should consider developing a standardized template to guide manufacturer responses, with clearly defined parameters for cost, prevalence, and utilization estimates. While manufacturers may choose to submit detailed dossiers, a core data template would promote consistency and reduce potential disparities between large and small companies. All submissions should be accompanied by methodological disclosures, including funding sources and known limitations, to support appropriate interpretation.

Questions 38-43: Clinical-Focused Input. Clinician perspectives offer valuable insights into treatment paradigms, clinical utility, and real-world challenges. CMS should consider requesting that clinicians describe observed differences in treatment access, including among individuals living in rural areas, people with disabilities, and others who may experience reduced access due to geographic, socioeconomic, or functional factors. Submissions should also address relevant patient-centered outcomes- including adherence, tolerability, and quality of life-in addition to traditional clinical endpoints. Clarifying the role of non-clinical influences, such as formulary placement or cost-sharing, would further strengthen the utility of these submissions.

Questions 44-50: Research-Focused Input. Input from researchers and advocacy organizations can enhance understanding of patient-centered outcomes and disease burden. CMS should prioritize evidence from studies that incorporate real-world data, caregiver impact research, and patient-reported outcomes. While economic evaluations can provide relevant context, their use should be calibrated to avoid reinforcing models that risk undervaluing the lives of individuals with chronic conditions or disabilities. Emphasis should be placed on meaningful patient-reported outcomes, including quality of life, symptom burden, and treatment preferences. As in other sections, methodological transparency is essential to ensure utility and interpretability.

Questions 51-53: Other Public Input. This section offers an important pathway for broader societal perspectives. CMS should clarify that responses may include information from community-based organizations, health systems, or other civic institutions that experience indirect effects of therapeutic value, such as impacts on the caregiving workforce or public health infrastructure. This section may also be used to identify areas where evidence is lacking, particularly for conditions that are less common or for groups that face practical challenges in accessing care.

Questions 54-55: Visual Representations and Citations. The NHC supports CMS' inclusion of dedicated space for visual materials and citations. However, the current limits-20 visuals and 250 citations-may be unduly restrictive for certain submitters. CMS should clarify whether these limits apply per drug or per respondent and allow flexibility where justified. Importantly, formal citation requirements should not be imposed on patient or caregiver respondents, whose testimony remains critical even when unsupported by peer-reviewed sources. In contrast, manufacturers and researchers should be held to appropriate standards of documentation and citation.

Question 56: Proprietary Information. The NHC encourages CMS to adopt a cautious approach to proprietary designations. Transparency is critical to the legitimacy of the negotiation process. Redactions should be narrowly limited to trade secrets or information demonstrably likely to cause competitive harm if disclosed. CMS should also publish anonymized, aggregate summaries of all responses-especially patient and caregiver submissions-to ensure that their contributions remain visible and impactful throughout the decision-making process.

Part 2: Drug Price Negotiation and Renegotiation Process Counteroffer ICR Form

The NHC recognizes that the counteroffer ICR process is primarily directed to manufacturers and governs the mechanics of their statutory and renegotiation submissions. While the NHC does not directly participate in this process, it is essential that counteroffers be managed in a manner that maintains trust in the program and upholds patient-centered objectives. As CMS evaluates counteroffers, the agency should remain guided by the statutory goals of the IRA: improving affordability, ensuring fairness, and promoting long-term sustainability. The structure and timing of the 30-day response window should also strike an appropriate balance between timeliness and fairness, allowing manufacturers sufficient opportunity to submit complete and accurate information while supporting the efficient progression of negotiations. Minimizing uncertainty throughout this process is critical for the patients who depend on these therapies.

To strengthen transparency and public confidence in the negotiation process, CMS should publish aggregated, de-identified summaries of manufacturer justifications submitted through the counteroffer process. These summaries would demonstrate that counteroffers are subject to rigorous and consistent review, reinforcing the integrity of the program while protecting sensitive commercial information. Public access to such information would also help stakeholders understand the factors considered during negotiations and provide assurance that the process remains aligned with statutory objectives and patient-centered principles.

The NHC also appreciates CMS' continued commitment to excluding Quality-Adjusted Life Years (QALYs) from the negotiation process, as required by statute and reiterated in recent guidance. Valuing life differently based on disability status, age, or other characteristics is inappropriate, and the exclusion of QALYs is essential to preserving fairness in Medicare drug price negotiations.11 However, the NHC remains concerned about the potential for QALY-related data to influence analysis through secondary sources. We encourage CMS to provide additional clarity on how such metrics are identified and excluded in practice, and to indicate when QALY-based information has been removed from manufacturer submissions or internal justification documentation. More broadly, therapeutic value assessments should reflect the full range of patient experiences, not a single summary metric. The NHC recommends that CMS incorporate multiple sources of evidence to capture outcomes patients consider meaningful, such as daily functioning, treatment burden, quality of life, and financial impact. This multidimensional approach will help ensure that negotiation decisions remain aligned with patient priorities and statutory intent.

Taken together, these refinements would ensure that the counteroffer ICR process supports fair and effective Medicare drug price negotiations while reinforcing patient trust in the program.

Conclusion

The NHC values the opportunity to engage with CMS on this important process and remains committed to working together to ensure that Medicare beneficiaries have access to affordable, high-value care.

Thank you again for the opportunity to provide input to CMS on this ICR. Please do not hesitate to contact Kimberly Beer, Senior Vice President, Policy & External Affairs at [email protected] or Shion Chang, Senior Director, Policy & Regulatory Affairs at [email protected], if you or your staff would like to discuss these comments in greater detail.

Sincerely,

Randall L. Rutta
Chief Executive Officer

1 Sarosh Nagar, Leah Z. Rand, and Aaron S. Kesselheim, "What Should US Policymakers Learn From International Drug Pricing Transparency Strategies?" AMA Journal of Ethics 24, no. 11 (2022): E1083- 1090, https://doi.org/10.1001/amajethics.2022.1083.

2 Sean R. Tunis et al., "Use of Real-World Evidence in the Medicare Drug Price Negotiation Program: A Checklist for the Centers for Medicare and Medicaid Services and Manufacturers," Health Affairs Scholar 3, no. 3 (March 21, 2025): qxaf030, https://doi.org/10.1093/haschl/qxaf030

3 National Health Council, Amplifying the Patient Voice: Reflections and Recommendations from the Second Cycle of CMS Patient Engagement (August 2025), https://nationalhealthcouncil.org/wp- content/uploads/2025/08/Amplifying-the-Patient-Voice-Reflections-and-Recommendations-from-second- cycle.pdf.

4 Justin Lo, Michelle Long, Rayna Wallace, and Kaye Pestaina, "Claims Denials and Appeals in ACA Marketplace Plans in 2023," KFF, January 27, 2025, https://www.kff.org/private-insurance/claims-denials- and-appeals-in-aca-marketplace-plans-in-2023/

5 Steven M. Lieberman and Paul B. Ginsburg, "Knowing Actual Prices Will Help HHS Set the Maximum Fair Price Under the Inflation Reduction Act," Health Affairs Forefront, February 16, 2024, https://doi.org/10.1377/forefront.20240212.193706

6 National Academies of Sciences, Engineering, and Medicine, Making Medicines Affordable: A National Imperative, ed. SJ Nass, G. Madhavan, and NR Augustine (Washington, DC: National Academies Press, 2017), chap. 3, "Factors Influencing Affordability," https://www.ncbi.nlm.nih.gov/books/NBK493090/

7 Matthew J. Martin et al., Prescription Drug Price Measures to Inform Upper Payment Limits: Guidance for State Prescription Drug Affordability Boards, PORTAL (Harvard Medical School and Brigham and Women's Hospital), December 13, 2024, https://eadn-wc03-8290287.nxedge.io/wp- content/uploads/2025/01/PORTAL_Price-Measures-for-UPLs-Memo_Final.pdf

8 Inmaculada Hernandez, Nathan Gabriel, and Sean Dickson, "Nonfederal Average Manufacturer Price to Estimate Savings Generated by Minimum Discounts under the Inflation Reduction Act," Journal of Managed Care & Specialty Pharmacy 29, no. 11 (2023): 1261-63, https://pmc.ncbi.nlm.nih.gov/articles/PMC10609926/

9 Steven Simoens and Isabelle Huys, "R&D Costs of New Medicines: A Landscape Analysis," Frontiers in Medicine 8 (October 25, 2021), https://doi.org/10.3389/fmed.2021.760762.

10 Mujaheed Shaikh, Pietro Del Giudice, and Dimitrios Kourouklis, "Revisiting the Relationship Between Price Regulation and Pharmaceutical Research and Development (R&D) Intensity," Health Economics (2020), https://doi.org/10.1007/s40258-020-00601-9

11 National Council on Disability. Quality-Adjusted Life Years and the Devaluation of Life with Disability. Washington, DC: National Council on Disability, November 6, 2019. https://www.ncd.gov/assets/uploads/reports/2019/ncd_quality_adjusted_life_report_508.pdf#:~:text=Adjus ted%20Life%20Year%20,in%20countries%20where%20QALYs%20are