Understanding the NDC Directory
To analyze the market and price projections for a specific drug identified by its National Drug Code (NDC), it is crucial to understand the NDC Directory. The NDC Directory, maintained by the FDA, contains comprehensive information on finished drug products, including prescription and over-the-counter drugs, approved and unapproved drugs, and repackaged or relabeled drugs[4].
Identifying the Drug
The NDC 24385-0106 can be searched in the FDA's NDC Directory to identify the specific drug product. This directory provides details such as the proprietary name, non-proprietary name, dosage form, route of administration, beginning and end marketing dates, application number, labeler name, strength, package code, and package description[1].
Market Context
Current Pricing Trends
The pharmaceutical market is experiencing significant changes, particularly with the introduction of Medicare's Drug Price Negotiation Program. This program, set to begin in January 2026, will negotiate prices for selected drugs under Medicare Part D, aiming to reduce costs for Medicare enrollees and the federal government. The program has already identified its first set of drugs, which have seen substantial price increases between 2018 and 2023, ranging from 20% to 55%[2][5].
Impact of Medicare Negotiation
For drugs selected under the Medicare negotiation program, the negotiated prices (Maximum Fair Prices) are expected to result in significant discounts compared to the current list prices. For example, the discounts for the first set of negotiated drugs range from 38% to 79%[2].
Price Projections
Negotiated Prices Under Medicare
If the drug with NDC 24385-0106 is selected for negotiation under the Medicare program, its price is likely to be significantly reduced. Here are some key points to consider:
- Discounts: Negotiated prices could result in discounts of up to 79% compared to the current list prices[2].
- Savings: For Medicare enrollees, the negotiated prices could save an estimated $6 billion in net covered prescription drug costs in the first year alone, representing a 22% reduction in net spending[5].
Future Price Adjustments
After the initial negotiation year, the negotiated prices will be adjusted annually based on the Consumer Price Index for all urban consumers (CPI-U). This ensures that the prices remain aligned with inflationary trends[5].
Industry Impact
Manufacturer Revenues
The Medicare negotiation program is expected to reduce manufacturer revenues significantly. According to Avalere's analysis, the program could reduce manufacturer revenues by $165 billion in Part D and $290 billion in Part B from 2026 to 2032[3].
Compliance and Penalties
Manufacturers that do not comply with the negotiation process may face civil monetary penalties and excise taxes, which could further impact their revenues. The penalties and taxes are designed to ensure compliance and can be substantial if manufacturers opt not to negotiate[3].
Consumer Impact
Affordability and Access
The negotiated prices will improve drug affordability for Medicare enrollees, enhancing access to innovative and life-saving treatments. For example, the estimated savings of $1.5 billion in the first year will directly benefit individuals by reducing their out-of-pocket costs[5].
Data and Methods
NDC Directory Data
The NDC Directory provides detailed data on drug products, which can be used to analyze market trends and price changes. This data includes the product type name, non-proprietary name, dosage form, route of administration, and other critical details[1][4].
Market Analysis
To project future prices, market analysts use historical data on price trends, sales volumes, and regulatory changes. For instance, analyzing the list price increases between 2018 and 2023 for similar drugs can help predict potential future price adjustments[2].
Key Takeaways
- NDC Directory: A comprehensive resource for identifying and analyzing drug products.
- Medicare Negotiation: Expected to significantly reduce prices for selected drugs, starting in 2026.
- Price Projections: Negotiated prices could result in discounts of up to 79% and will be adjusted annually based on CPI-U.
- Industry Impact: Manufacturer revenues are expected to decrease substantially due to the negotiation program.
- Consumer Impact: Improved affordability and access to life-saving treatments for Medicare enrollees.
FAQs
Q: What is the NDC Directory, and how is it used?
A: The NDC Directory is a resource maintained by the FDA that contains information on finished and unfinished drug products. It is used to identify and analyze drug products based on their NDC numbers.
Q: How will the Medicare Drug Price Negotiation Program affect drug prices?
A: The program will negotiate prices for selected drugs, resulting in significant discounts compared to current list prices, with savings estimated to be up to 79%.
Q: What happens if a manufacturer does not comply with the Medicare negotiation process?
A: Manufacturers that do not comply may face civil monetary penalties and excise taxes, which can substantially impact their revenues.
Q: How will the negotiated prices be adjusted over time?
A: The negotiated prices will be adjusted annually based on the Consumer Price Index for all urban consumers (CPI-U).
Q: What is the expected impact on Medicare enrollees?
A: The negotiated prices are expected to improve drug affordability, enhancing access to life-saving treatments and reducing out-of-pocket costs for Medicare enrollees.
Sources
- FDA: NDC Directory (March 2015) - FDA
- ASPE: Medicare Drug Price Negotiation Program - ASPE - HHS.gov
- Avalere: Drug Pricing Bill Could Reduce Manufacturer Revenue by Over $450B
- FDA: National Drug Code Directory - FDA
- CMS: Negotiated Prices for Initial Price Applicability Year 2026 - CMS
