New Bill Strips Exclusivity from Drugs Priced Higher Than International Median, Fast-Tracks Generics

The newly proposed Prescription Drug Price Relief Act of 2025 is the legislative equivalent of a pharmaceutical price check, and it’s a big deal. Essentially, the bill empowers the Secretary of Health and Human Services (HHS) to compare the price of brand-name drugs sold in the U.S. against the median price charged in five other developed nations—Canada, the U.K., Germany, France, and Japan (SEC. 2).

If a drug’s U.S. price is found to be “excessive”—meaning it’s higher than that international median, or if it fails a test based on factors like R&D costs, public subsidies, or price increases above inflation—the government immediately cancels all its patents and exclusivity rights. The goal is simple: if the price is out of line, the government pulls the plug on the monopoly, allowing generic and biosimilar competitors to jump in right away via open, non-exclusive licenses (SEC. 3).

The International Price Check and the Nuclear Option

For years, we’ve heard that the same medication costs a fraction overseas compared to here. This bill creates a formal, annual process to test that theory. If the Secretary determines that a brand-name drug is excessively priced, they must issue immediate, open licenses allowing any manufacturer to produce the drug (SEC. 3(a)). This is the “nuclear option” for drug pricing; it’s a direct attack on the intellectual property protections that shield high-cost drugs from competition. For consumers, this could mean a rapid drop in price for specific, life-saving medications that have been kept artificially expensive by market exclusivity. If you rely on a high-cost specialty drug, this provision could change your monthly budget dramatically.

Open Books and Heavy Penalties

To make this system work, the bill forces brand-name manufacturers to open their books in a way they never have before. They must submit extensive annual reports detailing everything from U.S. and foreign pricing, global revenue, and, critically, itemized breakdowns of their research and development (R&D) costs—including any government grants or tax credits they received (SEC. 6). This is designed to expose how much public money subsidized the drug’s creation versus how much the company actually invested.

And here’s where the street smarts come in: the penalties for non-compliance are brutal. If a manufacturer misses the January 15th reporting deadline or submits false info, they face a civil monetary penalty that can reach up to 1% of the drug’s gross revenue, multiplied by every day the report is late (SEC. 6(c)). This isn't a slap on the wrist; for a blockbuster drug, this could mean millions in fines daily, making timely, accurate reporting non-negotiable for manufacturers.

The Royalty Reality Check

If a generic company takes one of these new open licenses, they don't get a free pass. They still have to pay the original patent holder a “reasonable royalty.” However, this royalty is capped and must be set with the goal of ensuring the resulting generic drug is sold at an “affordable and reasonable” price—specifically, lower than the price that was deemed excessive (SEC. 4). This means the original company gets paid back for their innovation, but not so much that it keeps the drug out of reach for patients.

For the average person, this is where the rubber meets the road. This mechanism attempts to balance the need for pharmaceutical companies to fund future R&D with the immediate need for patients to access affordable medication. It aims to prevent the situation where a generic drug is technically available but still too expensive for many people due to high royalty demands.

The Public Database and the Power of the Secretary

Finally, the Secretary must create a public, searchable database detailing every drug flagged as excessively priced, every license granted, and every petition filed by the public asking for a price review (SEC. 5). This transparency is huge, allowing patients, advocates, and researchers to track which drugs are being targeted and how the process is working.

However, it’s worth noting that the Secretary has a lot of wiggle room. Beyond the international price comparison, the Secretary can declare a price excessive based on vague criteria like “how valuable the drug is to patients” or “any other factors the Secretary thinks are important” (SEC. 2(b)). This broad authority is a double-edged sword: while it gives the government flexibility to target bad actors, it also gives a single office significant power over a multi-billion dollar industry, which could lead to legal challenges and uncertainty.