S 1818119th CongressIn Committee

Prescription Drug Price Relief Act of 2025

Introduced: May 20, 2025

Healthcare

Standard Summary

Comprehensive overview in 1-2 paragraphs

The Prescription Drug Price Relief Act of 2025 aims to bring down U.S. prescription drug prices by identifying brand-name drugs that are priced excessively compared with prices in a set of international reference countries, and then ending government-granted monopolies for those drugs. If a drug is deemed excessively priced, the bill requires the government to waive exclusivities and grant open, non-exclusive licenses so others can manufacture and sell the drug in the United States, with the licensees allowed to rely on the original drug’s regulatory data. The bill also sets up a process for faster approval of generics and biosimilars referencing those drugs, creates a royalty system to compensate patent holders, and imposes reporting, transparency, and enforcement provisions designed to ensure prices become affordable. A public database and annual congressional reports would track excessive pricing determinations, licenses issued, and related pricing data.

Key Points

1Identification of excessive prices
2- The Secretary will review all brand-name drugs at least annually and determine excessivity by comparing the domestic price to the median price in five reference countries (Canada, UK, Germany, France, Japan). Data from at least 3 of the 5 countries is needed for a determination.
3- If a drug isn’t deemed excessive by the international reference standard, the Secretary can still declare it excessive based on other factors (patient population size, value to patients, government subsidies, development costs, health outcomes, global revenues, and price changes relative to CPI, plus other relevant factors).
4Ending monopolies and enabling competition
5- For drugs deemed excessively priced, the Secretary must waive or void government-granted exclusivities and grant open, non-exclusive licenses allowing others to make, use, sell, or import the drug and rely on the original regulatory data.
6- Expedited review: generic/biosimilar applications referencing such a drug must be acted on within eight months.
7Remedies and enforcement
8- If the drug price increases after the excessive-pricing determination but before a license is in place, the government can sue the manufacturer for damages equal to the revenue gained from that price increase.
9- Civil actions may seek injunctive relief and damages.
10Royalty framework and pricing safeguards
11- Licensees must pay a reasonable royalty to patent holders, calculated either as a percentage of sales (not higher than the average royalty rate reported on IRS pharmaceutical returns) or as a rate determined by the Secretary, considering factors such as patient value, population size, government subsidies, development costs, and health outcomes.
12- Royalty payments must not enable prices to become excessive, and royalties are to be shared among all holders/investors of related patents if applicable.
13- Licenses require selling the drug at prices below the determined excessive price.
14Transparency and reporting
15- Manufacturers must annually report detailed pricing, sales, development, and subsidy data for each brand-name drug, including international price comparisons and development expenditures.
16- A public Excessive Drug Price Database will list drug names, manufacturers, whether they were deemed excessive, petitions received, open licenses granted, and related regulatory filings.
17- Congress receives annual reports with statistics on reviews, determinations, license activity, and pricing data.
18Prohibition of anticompetitive behavior
19- The bill prohibits manufacturers from engaging in anticompetitive practices that interfere with open licenses or otherwise hinder affordable drug availability.
20Definitions and scope
21- Key terms include average manufacturer price, brand name drug, generic drug, biosimilar, government-granted exclusivity, and open, non-exclusive license. The Secretary of Health and Human Services administers the program.

Impact Areas

Primary group/area affected- U.S. patients and consumers: potential for lower drug prices and increased access to medications previously protected by monopolies.- Payers (Medicare/Medicaid, private insurers, and patients paying out-of-pocket): potential reductions in spending due to lower list prices and increased competition.Secondary group/area affected- Brand-name drug manufacturers: would face loss of exclusivities and need to participate in licensing arrangements and potential royalty payments; may be incentivized to price drugs more reasonably or innovate with different strategies.- Generic drug and biosimilar manufacturers: new opportunities to enter the market quickly via open licenses; potential for accelerated approvals and earlier market entry.- Federal programs and regulators: new processes for price reviews, licensing, and oversight; requirement to maintain the public database and annual reports.Additional impacts- Innovation incentives: the proposal could affect pharmaceutical investment decisions by altering how exclusivities are valued and how royalties are set, which may influence R&D strategies.- Federal budgeting and enforcement: funding for NIH programs would be supported by collected penalties; new regulatory and administrative workload for the Secretary and agencies.- Legal and regulatory environment: significant changes to how drug pricing and patent data interact with exclusivity provisions and patent rights, plus new mechanisms for civil actions and licensing.

Generated by gpt-5-nano on Oct 7, 2025