A press release from CMS today provides the answer:
[The Department of Health and Human Services] HHS expects each manufacturer to commit to aligning US pricing for all brand products across all markets that do not currently have generic or biosimilar competition with the lowest price of a set of economic peer countries. The MFN target price is the lowest price in an OECD country with a GDP per capita of at least 60 percent of the U.S. GDP per capita.
Which countries would be included in the MFN comparison basket? Endpoints reports:
Under the most favored nation math, that would tie US drug prices to those in Luxembourg, Ireland, Switzerland, Norway, Iceland, Denmark, Australia, the Netherlands, Austria, Sweden, Belgium, Germany, Canada, Finland, Israel and the UK.
If HHS opts to use per capita GDP by purchasing power parity as its metric, US prices could also be tied to those in Italy, Slovenia, New Zealand, Spain, the Czech Republic, South Korea, Lithuania and Japan.
[my bolding]
Drugs with generic or biosimilar competition would be exempted from MFN negotiation.
