Analysis

Trump's Drug Rebate Ban Faces Fraught Legal Path

Law360 (February 15, 2019, 6:41 PM EST) -- One of the Trump administration’s boldest moves to ease drug prices — a ban on billions of dollars in rebates negotiated by middlemen for health insurers — will need to traverse a legal minefield to become reality, experts say.

The recent proposal would use threats of prison time and massive fines under the Anti-Kickback Statute to eliminate rebates negotiated in Medicare and Medicaid by pharmacy benefit managers, or PBMs. Rebates in those two programs — long shielded by an Anti-Kickback Statute safe harbor — total tens of billions of dollars annually.

“It’s an amazing regulation in that ... it basically criminalizes the...

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