CMS Gets Under The Skin Of Subcutaneous Drugmakers

Research evidence excerpt

CMS Gets Under The Skin Of Subcutaneous Drugmakers

Pharmaceuticals (Major) & Large Cap Biotechnology

Pharmaceuticals - Major - Market Weight

CMS Gets Under The Skin Of Subcutaneous Drugmakers June 15, 2026

The Wolfe Byte

CMS' proposed rule to negotiate subcutaneous formulations together with their single source drug has confirmed

a concern that frankly many investors had already seen coming. MRK & BMY see this as little surprise, while JNJ

reiterates 2034 for Darzalex given orphan exclusion.

The Centers for Medicare Services (CMS) proposed that subcutaneous formulations of a drug will be considered part

of the same qualifying single source drug. CMS proposed a rule last Friday that looks to establish new guidance for the

Medicare Drug Price Negotiation Program (MDPNP) for initial price applicability year 2029 and beyond. Recall that under

the current policy established for years 2026-2028, a distinct combination comprised of two or more active moieties

(active ingredients/antigen components) was considered its own active moiety. CMS recognized that drug manufacturers

were utilizing a "fixed combination drug loophole" whereby manufacturers would avoid negotiation selection of a drug

by approving and marketing a new formulation through the addition of another active ingredient, enabling an alternative

route of administration. Of course, we are familiar with this process via the new subcutaneous formulations that IV

drugs launch with for improved convenience and as part of drug life cycle management. With this proposed rule, CMS

seeks to consider any fixed combination drug with active ingredients that were added for the purpose of creating a new

formulation/altering the route of administration as the same NDA/BLA as its original reference drug. Specifically, CMS