Medicare drug price negotiation hasn’t dried up venture capital


Venture capitalists continue investing in drug research despite Medicare’s new authority to negotiate drug prices. The Inflation Reduction Act includes two measures that reduce drug prices, with Medicare price negotiation being the most controversial. Medicare will now negotiate prices for top-selling drugs without generic or biosimilar competition, beginning 9 years after their market appearance. The law also requires drug companies to pay back Medicare if they increase prices faster than inflation. It targets 10 drugs initially, 60 over the next four years, and then 20 more every year. Despite these legislative changes, investment into drug research continues to grow.

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