Trump Administration gets serious on MFN drug pricing with two new proposed CMS models in Medicare: GUARD and GLOBE
The Trump Administration finished 2025 with its most aggressive push yet toward implementing international reference pricing for prescription drugs in Medicare. On December 19, the Centers for Medicare & Medicaid Services (CMS) proposed two more models in the Trump administration’s efforts to reduce drug prices and address what Trump Administration officials call international “freeloading”. The two payment models – dubbed GLOBE and GUARD – apply to medicines covered under Medicare Part D, an outpatient prescription drug benefit provided to more than 50 million older adults in the US, and Medicare Part B, which covers outpatient services like injectables administered in physician offices. Both models would use Trump’s most favored nation (MFN) approach to pricing, benchmarking US Medicare payments to the prices paid in economically comparable countries (both models will reference 19 countries). Both programs will be mandatory. If finalized, the two rules will impose additional, mandatory rebates on drugmakers alongside the system of Medicare drug price negotiations for drugs with high Medicare Part B and D. The rules follow the introduction earlier this year of the GENEROUS model, a voluntary MFN framework for medicine manufacturers that participate in the Medicaid Drug Rebate Program (MDRP). These models will arrive alongside the launch of the TrumpRx direct-to-consumer (DTC) drug purchasing channel, to which more than a dozen of the biggest pharma companies have now agreed to provide some discounted medicines. According to the proposals, GUARD (Part D) would begin January 1, 2027 and run for five years. GLOBE (Part B), meanwhile, would start October 1, 2026 and run for five years. CMS predicts that the GLOBE will cut Medicare spending by $11.9 billion while GUARD will reduce it by $14.1 billion over their respective periods. In a statement, the Pharmaceutical Research and Manufacturers Association (PhRMA) criticized the proposed rules: “Government policies that mandate broad-based foreign price controls are bad for American patients and undermine US leadership. By CMS’ own admission, the proposed policies are projected to increase costs for America’s seniors, and they will siphon billions from US medicine R&D at a time when China is on the verge of surpassing us.” Comments on both the GLOBE and GUARD proposed rules are due by February 23, 2026. While it’s unlikely that there will be major changes before final rules are released later this year, there may be some modifications. CMS has launched websites for each model. The GLOBE model resource center can be accessed here, while the GUARD model resource center is here. Today, the FDA Law Blog published a good summary of the proposed rules. It’s unlikely that either proposal will run into firm congressional opposition, so it’s important for companies and patient advocates to prepare for implementation of these two major rules. For more information or to discuss specifics on the two proposed models, please contact Gridiron directly.
Federal government extends telehealth coverage for prescribing some medications; broader Medicare telehealth extension expires this month
Federal health officials moved to prevent a sudden cutoff in care for millions of patients by extending telemedicine rules that allow doctors to prescribe certain controlled medications without a prior in-person visit through the end of 2026. The U.S. Department of Health and Human Services, working jointly with the Drug Enforcement Administration, announced a fourth temporary extension of pandemic-era telehealth flexibilities, keeping them in place from January 1 through December 31, 2026. The decision buys regulators more time to finalize permanent rules while avoiding what officials describe as a looming “telemedicine cliff.” Without the extension, patients who rely on virtual care — including seniors, rural residents, people with disabilities, and those receiving treatment for mental health conditions or substance use disorder — could have abruptly lost access to medications they depend on. In a statement, HHS heralded the extension that allows the government more time to put a permanent solution in place, ensuring continuity of care. On the larger issue of Medicare coverage of telehealth services, Congress extended coverage through January 31, 2026 but must take additional action. In the meantime, CMS continues to issue guidance to providers on how to navigate the muddled coverage and reimbursement environment.
Congress returns from holiday break with health care issues awaiting action and another shutdown threat
While we sincerely hope that you had a restful holiday break, things weren’t peaceful on the political front. Nonetheless, members of Congress return this week with a very heavy legislative agenda and many distractions. With the U.S. military action removing former Venezuelan dictator Nicolas Maduro consuming the headlines, there continues to be a push for more action on release of the Jeffery Epstein files—which will cause ongoing headaches for congressional leadership. Action must be taken on several fronts to avoid another government shutdown on January 31. On the health care front, the sticker shock of Affordable Care Act plans on the federal health care marketplace has become a reality for about 22 million Americans who have been receiving COVID-era enhanced subsidies, with congressional leaders unable to find a consensus on a path forward. Members of Congress left for the holiday break knowing that the ACA subsidy issue would be raised again in January. It is still highly unlikely that a permanent extension of the subsidies will pass. A small group of bipartisan House and Senate members continue to explore options for limited expansion with reforms, but we’ll have to wait to and see if anything gains steam as the month progresses. Senator Bernie Sanders (I-VT) effectively blocked passage of the rare pediatric review voucher program right before the holiday break. A bipartisan group of senators attempted to pass the “Give Kids a Chance Act of 2025” through unanimous consent, but Sen. Sanders objected—killing the measure for now. Sanders continues to see the program as a “giveaway” to biopharmaceutical companies, despite ongoing research showing that the PRV program has successfully led to the discovery of new medications to treat rare diseases. Advocates will now push for inclusion of the language in any health care package that could move later this month.
Health Policy Snippets
- President signs National Defense Authorization Act (NDAA), which includes BIOSECURE language. After two years of debate and discussion, The BIOSECURE Act, a section formally called “Prohibition on Contracting with certain Biotechnology providers”, passed and was signed into law by President Trump the week before Christmas. The language is designed to limit Chinese biotechs and manufacturers from accessing US funding and collaborating with US pharma companies using federal funding. However, the final version does not name specific Chinese companies. Instead, the Office of Management and Budget (OMB) will create a list of prohibited companies within one year of the act’s passage and update the list annually. A top priority of the biotech community, the final version also maintains a five-year grandfathering/wind-down period for companies to sever ties with identified “companies of concern”. While no specific companies are mentioned, observers expect several Chinese companies with long-standing relationships with US biotech companies (e.g. WuXi) to be included in the forthcoming OMB list.
- Big wins for Virginia Democrats put the state on track for a new Prescription Drug Affordability Board (PDAB). With the departure of Republican Governor Glenn Youngkin, who twice vetoed PDAB legislation, and expanded Democrat majorities in the state legislature, patient advocates are bracing for Virginia to join the ranks of states passing drug price control boards in 2026. Newly-elected Governor Abigial Spanberger (D) recently released an “affordability agenda”, with multiple health care components. While Spanberger hasn’t personally championed PDABs at this point, a third PDAB bill is expected to sail through the legislature. On a positive note, Spanberger’s agenda includes specific proposals to reform prior authorization in the state, arguing that excessive prior authorization processes delay care and ultimately increase health care costs. Virginia will likely be at the forefront of state health care policy issues in 2026.
