If you want to bury something, CMS says release it on Friday night. If you really want to bury it, use the Friday night before Christmas week.
Proposals peg US drug prices to prices (benchmarks) in other countries. There are two separate rules. One, GlOBAL BENCHMARK or "GLOBE," is Part B injectibles. The other, GUARD, is Part D drugs.
See GLOBE press release here. Innovation website here. Fed Reg here. The proposal is 279 pages; see paginated version Dec. 23.
See GUARD press release here. Innovation website here. Fed Reg here. The proposal is 281 pages long.
Here's the TLDR note:
The Trump administration proposed two Medicare drug pricing pilots tying U.S. payments to international benchmarks. A Part B model (2026–2031) and a Part D model (2027–2031) could save Medicare about $26 billion total and reduce seniors’ outpatient out-of-pocket costs by $6.2 billion. However, prescription drug costs for seniors could rise $3.6 billion longer term as manufacturers offset losses by raising other prices. Both models exclude drugs already under Medicare negotiation. Pharma groups strongly oppose the plans, warning of higher costs and reduced R&D.
AI SUMMARIES
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GLOBE (PART B)
Below is a ~350-word policy-blog summary of the proposed GLOBE Model rule, written for a Medicare / reimbursement–savvy audience and focused on what matters strategically.
CMS has proposed a new mandatory Medicare payment demonstration—the Global Benchmark for Efficient Drug Pricing (GLOBE) Model—that would fundamentally reshape how inflation rebates are calculated for high-cost Medicare Part B drugs by anchoring them to international price benchmarks. The proposal is issued under CMMI’s Section 1115A authority and would run from October 2026 through September 2033, including five performance years and two additional years for rebate reconciliation .
The model targets a narrow but financially dominant slice of Part B: single-source drugs and sole-source biologics that already fall under the Part B inflation rebate program. CMS estimates that more than two-thirds of Part B drug spending—roughly $46 billion annually—is concentrated in this category, with biologics overwhelmingly driving growth. Manufacturers of selected drugs would be mandatory participants, while providers continue to buy-and-bill as usual.
The core policy change is not ASP payment itself, but the rebate back-end. Today’s inflation rebate compares current ASP to an inflation-adjusted historical ASP. Under GLOBE, CMS would instead calculate a modified rebate using international reference pricing, testing two alternative approaches:
a benchmark tied to the lowest price observed among economically comparable countries using commercial data sources, and
a benchmark based on manufacturer-submitted net international prices, averaged across comparator countries. CMS will evaluate which method produces greater savings without access disruptions.
Importantly, beneficiaries in the model cohort (about 25% of Part B FFS enrollees) would see reduced coinsurance on affected drugs (for example, 10% instead of 20%), with Medicare paying the difference. CMS projects $11.9 billion in Part B savings, plus spillover savings in Medicare Advantage and Medicaid, alongside $6.2 billion in reduced beneficiary out-of-pocket costs, although CMS acknowledges potential manufacturer price-offset behavior in later years.
Strategically, GLOBE represents a second front in federal drug pricing policy—parallel to IRA negotiation—focused specifically on Part B physician-administered drugs, where ASP add-on incentives, biologic dominance, and rapid launch pricing have long challenged cost control. If finalized, GLOBE would mark the federal government’s most explicit move yet toward international reference pricing in Medicare, even if implemented indirectly through rebates rather than front-end payment rates.
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GUARD PART D
CMS has proposed the Guarding U.S. Medicare Against Rising Drug Costs (GUARD) Model, a mandatory Part D payment demonstration that would explicitly benchmark U.S. drug prices against international prices when calculating inflation rebates. Issued under CMMI’s Section 1115A authority, GUARD targets the back-end rebate mechanics of Medicare Part D, rather than front-end negotiated prices or formulary design, and would operate from 2027 through 2033, with rebate settlement extending to 2035.
The model focuses on a high-spend, high-leverage subset of Part D drugs: sole-source brand drugs and biologics across major therapeutic classes, including oncology, CNS, cardiovascular, metabolic, immunologic, and respiratory agents. Generics, biosimilars, low-spend drugs, and drugs already subject to a negotiated Maximum Fair Price (MFP) under the IRA are excluded. Manufacturer participation would be mandatory, while Part D plans and PBMs remain operationally unchanged.
Today’s Part D inflation rebate compares a drug’s U.S. price growth to CPI-U. GUARD would instead test whether Medicare should anchor inflation rebates to international price benchmarks, using OECD peer countries such as Germany, Canada, Japan, France, and the UK. CMS proposes two benchmarking methods:
a default benchmark equal to the lowest GDP-PPP-adjusted average price observed among reference countries, and
an optional manufacturer-submitted benchmark, based on averaged net prices across countries, subject to CMS validation.
CMS would apply the higher of the two benchmarks, a design choice that reduces—but does not eliminate—manufacturer downside risk.
If a drug’s Medicare net price (WAC minus rebates and discounts reported as DIR) exceeds the applicable international benchmark, the manufacturer would owe a GUARD rebate, replacing the standard Part D inflation rebate when larger. CMS estimates the model would reduce Medicare spending by $14.1 billion between 2028 and 2033, with funds deposited directly into the Part D trust account.
Strategically, GUARD is notable for what it signals. Alongside IRA negotiation and Part B’s GLOBE model, CMS is now testing international reference pricing across both Medicare drug benefits, albeit indirectly through rebate policy rather than explicit price setting. While CMS frames GUARD as a technical inflation-rebate experiment, its practical effect is to cap the long-term divergence between U.S. and global drug prices for single-source products—particularly specialty and oncology drugs that dominate Part D spending.
For manufacturers, GUARD raises new risks around global price coherence, launch sequencing, and rebate strategy, even if U.S. list prices remain formally unconstrained. For policymakers, it represents another step toward international price anchoring becoming normalized in Medicare, first quietly through CMMI models, and potentially later through statute.
