Contribution of revenue from drugs subject to price negotiation under the Inflation Reduction Act to the revenue, profit, and returns of pharmaceutical manufacturers

This study examines the finances of 11 public companies that commercialize 21 out of the 25 drugs subject to price negotiation in 2024 or 2025, respectively under the Inflation Reduction Act (IRA) of 2022. From 2019 to 2023, these companies reported US$2.5 trillion in revenue with US$412.8 billion from sales of IRA drugs, including US$260.8 billion US sales, less than cumulative earnings or shareholder distributions. Estimated margins on sales were greater than reported average industry investments in development. Overall, reducing revenue from these drugs would not limit funds for operations or required returns on investment, although impacts on individual companies could vary and should be considered in price negotiations.