Series: Manufacturer Responses to the Medicaid Drug Rebate Cap Removal

OBJECTIVE

To obtain Medicaid coverage for their drugs, Federal law generally requires pharmaceutical manufacturers to enter into rebate agreements with CMS and pay rebates to States and the Federal government. Before 2024, a drug’s rebate was capped at 100 percent of its average manufacturer price, meaning that a manufacturer could not owe more in rebates than it charged wholesalers and retail community pharmacies, on average, for the drug. The American Rescue Plan Act removed the rebate cap beginning on January 1, 2024, and in response, manufacturers reacted in ways that could significantly impact cost and access. OIG will conduct two studies exploring the number of drugs affected by the rebate cap removal, the range of manufacturer responses to its removal, and the effect these responses had on Medicaid, Medicare Part D, and enrollees of both programs.

There are 2 projects in this series.

Project titles will remain unpublished until projects are complete and reports are posted.

ACTIVE PROJECTS IN THIS SERIES (2)

TIMELINE

• June 16, 2025
  Series Number SRS-E-26-003 Assigned
• June 16, 2025
  Projects Announced

  Project OEI-05-25-00230

• Project OEI-BL-25-00220

• Today
  2 Evaluations In-Progress
• Est FY2027
  Estimated Fiscal Year for Series Completion

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