In 2024, drug makers lowered the cost of dozens of common medications to avoid penalties imposed by the American Rescue Plan, Katie Thomas of The New York Times reports. The decision to make the medications cheaper, such as certain insulin, has caused a severe financial hit to the clinics tasked by the federal government to care for the country’s poorest citizens. These nonprofit clinics rely on an old federal program that requires drug companies to offer them steep discounts. Each time the company raised its price on the drug, the clinic would receive a steeper discount. Now, however, companies are penalized for raising the cost of the drug, leading to these clinics no longer receiving the same discounts. Companies in the space include Eli Lilly (LLY), Novo Nordisk (NVO), and Sanofi (SNY).
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