Drug Pricing Proposals

Glossary of Drug Pricing Terms

Need help decoding the jargon? Browse our glossary to learn about key drug pricing terms.

ASP

Average Sales Price

The price paid after discounts.

IRA

Inflation Reduction Act

Medicare drug price negotiation law.

340B Program

Discount drugs for safety-net providers.

MFN Models

Most Favored Nation Pricing policies.

CMS

Centers for Medicare & Medicaid Services

Federal agency overseeing Medicare.

CMMI

Medicare Innovation Center

Testing new payment models.

MFP

Maximum Fair Price

Negotiated Medicare price.

PBMs

Pharmacy Benefit Managers

Managers of drug benefits.

Orphan Cures Act

Proposal for rare disease drugs.

Part B Drugs

Physician-administered drugs.

Part D Drugs

Medicare prescription drugs.

GLOBE

Global Benchmark for Efficient Drug Pricing

GUARD

Guarding U.S. Medicare Against Rising Drug Costs

GENEROUS

GENErating cost Reductions fOr U.S. Medicaid

IRP

International Reference Pricing

Drug pricing tied to prices paid in other countries.

Site of Care Payment Policy

Equal Medicare payment regardless of care setting.

DTP

Direct-to-Patient

Meds sent directly to patients.

DTC

Direct-to-Consumer

Ads targeting patients.

340B Rebate Model

340B rebate pilot program.

MFN

Most Favored Nation

Linking prices to other countries.

Orphan Drug

Drug for rare diseases.

Rebate

Payment after sale.

Upfront Discount

Discount at the point of sale.

TrumpRx

Direct-purchase plan.

Executive Order

Presidential drug pricing action.

Hospital Acquisition Cost Survey

CMS survey of hospitals’ actual outpatient drug purchase costs.

Drug Pricing Policy Updates & Impact

At The US Oncology Network, protecting patient access to community oncology is our top priority. As drug pricing proposals continue to emerge from Washington D.C., we track and analyze each initiative to ensure policymakers understand how these policies may affect cancer patients and the practices that serve them. Here you will find up-to-date information on the measures we are monitoring.

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Executive Actions on Drug Pricing

Summary

In 2025, the Trump administration issued two executive orders focused on lowering drug costs. One directed HHS to issue guidance for IRA negotiations, improve PBM transparency, and review site-of-care payment policies. The other instructed agencies to develop strategies for achieving MFN pricing. Additionally, the administration advanced voluntary discount agreements with manufacturers and launched the TrumpRx direct-to-patient purchasing initiative, while a separate presidential memorandum strengthened oversight of prescription drug advertising.

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Most Favored Nation (MFN) Models

Summary

As a result of the 2025 executive order on drug pricing, CMMI advanced MFN strategies to align U.S. drug costs with international benchmarks. Instead of reducing provider reimbursement like the blocked 2020 model, CMMI adopted a manufacturer rebate approach, modifying the Medicare inflationary rebate formula without impacting ASP. Three new models—GLOBE (Part B), GUARD (Part D), and GENEROUS (Medicaid)—will test MFN-linked rebates and international price benchmarking to lower costs through global alignment.

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Inflation Reduction Act

Summary

The IRA authorizes Medicare to negotiate prices for high-cost drugs, beginning with Part D in 2026 and expanding to Part B in 2028. It also introduces a $2,000 annual cap on out-of-pocket costs, penalties for non-compliance, and Maximum Fair Price ceilings based on drug age, significantly impacting patient affordability and provider reimbursement.

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