By NextBestFitPhase 1: Enactment & build · Step 1.9
Create the national formulary & negotiate drug prices
Months 0–18 for the initial formulary; continuous negotiation · National Formulary and Pricing Board; HTA InstituteDiscuss this step
How other countries handled this same piece of implementation, what happened, and what it means for this plan.
Side by side
| Country | Approach | Result | Lesson for this plan |
|---|---|---|---|
| This plan (U.S.) | A National Formulary and Pricing Board covers every FDA-approved drug with a negotiated price. Retail drug spending falls from $467.0B to $380.1B (price effect −$113.1B, utilization +$26.2B). | ||
| United Kingdom | NICE appraises drugs on cost per QALY (threshold raised in 2025 from £20–30k); the NHS must fund approved drugs. | Lower prices; some drugs rejected or delayed. | Explicit value thresholds are transparent and politically contentious. |
| Germany | AMNOG (2011): free price for 6 months, then a negotiated price based on added benefit. | Fast launches, lower prices for drugs without added benefit. | Provisional pricing with later assessment protects access speed. |
| New Zealand | PHARMAC buys drugs for the whole country through tenders and a fixed budget. | Very low drug prices; fewer new drugs funded than in Australia or Europe. | Hard budgets save money at the cost of access to new drugs. |
| Canada | PMPRB ceiling prices plus pan-Canadian joint negotiation (pCPA); national pharmacare began in 2024–25 with contraceptives and diabetes drugs. | Prices well below U.S. levels; launches sometimes later. | Joint negotiation leverages buying power. |
United Kingdom
- What they did
- NICE appraises drugs on cost per QALY (threshold raised in 2025 from £20–30k); the NHS must fund approved drugs.
- What happened
- Lower prices; some drugs rejected or delayed.
- Lesson for this plan
- Explicit value thresholds are transparent and politically contentious.
Germany
- What they did
- AMNOG (2011): free price for 6 months, then a negotiated price based on added benefit.
- What happened
- Fast launches, lower prices for drugs without added benefit.
- Lesson for this plan
- Provisional pricing with later assessment protects access speed.
New Zealand
- What they did
- PHARMAC buys drugs for the whole country through tenders and a fixed budget.
- What happened
- Very low drug prices; fewer new drugs funded than in Australia or Europe.
- Lesson for this plan
- Hard budgets save money at the cost of access to new drugs.
Canada
- What they did
- PMPRB ceiling prices plus pan-Canadian joint negotiation (pCPA); national pharmacare began in 2024–25 with contraceptives and diabetes drugs.
- What happened
- Prices well below U.S. levels; launches sometimes later.
- Lesson for this plan
- Joint negotiation leverages buying power.
More precedent
- Medicare IRA negotiation: the first 10 drugs' prices were 38–79% below list.
- Germany's AMNOG: benefit assessment within 6 months of launch, then a negotiated price.
- UK NICE: a cost-per-QALY threshold of £20,000–30,000 (raised in 2025).