Court Rulings Temporarily Block MFN Model Implementation

As expected by some in the pharma industry, judges in two U.S. district courts have temporarily blocked implementation of the administration’s most-favored-nation (MFN) model that was set to take effect Jan. 1. While some industry stakeholders agree that changes are needed to drug pricing policies, many of them maintain that this approach is the wrong way to go about it and hailed the decision. As of press time, it’s unclear what steps either the outgoing administration of President Donald Trump or the incoming administration of President-elect Joe Biden will take next.

Published as an Interim Final Rule with Comment Period (85 Fed. Reg. 76180, Nov. 27, 2020), the MFN model would “test whether more closely aligning payment for Medicare Part B drugs and biologicals…with international prices and removing incentives to use higher-cost drugs can control unsustainable growth in Medicare Part B spending without adversely affecting quality of care for beneficiaries” (RSP 12/20, p. 1).

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