New year brings new Medicare regime

The new year brings both opportunity and uncertainties for the US pharmceuticals market in 2006, with the entry into effect of the Medicare Modernization Act on January 1. Many patients will find that existing drugs will be reimbursed for the first time under the reformed Medicare program. In the short-term pharmaceutical firms should find that demand increases for affected products. However, the reform's longer term objectives to control costs could add to global pressures to control costs.

Already, the reduction in Medicare Part B reimbursement rates for treatments such as intravenous immune globulin (IVIG) are causing some patients to cut back on treatment, according to a warning issued by the US-based Immune Deficiency Foundation and The Neuropathy Association.