# CMS Finalizes Medicare Drug Pricing Model

CMS finalized the five-year GLOBE drug-pricing model on September 30, 2026, with implementation scheduled for January 1, 2027, in geographic areas containing about 25% of Original Medicare beneficiaries. On October 7, PhRMA sued, arguing CMS lacks authority to establish the model. For pharmaceutical manufacturers and supply-chain contractors, the model and pending litigation create near-term uncertainty for pricing assumptions, U.S. manufacturing investment, and supply-chain planning.

- The model is scheduled to begin in just over two months; affected businesses can assess their exposure based on the geographic areas covered and the model’s potential effects on pharmaceutical pricing.
- PhRMA’s legal challenge may affect the model’s implementation. Companies should account for the unresolved litigation when evaluating investment and supply-chain plans, as the source recommends.
- The model is not a contract opportunity, but its potential effects on pricing and manufacturing investment may shape suppliers’ and contractors’ business planning.

**Jurisdictions:** federal
**Industries:** Healthcare
**Topics:** Policy
**Published:** October 23, 2026

### Government Entities
- Centers for Medicare & Medicaid Services (CMS)

### Sources
- [Supply Chain Signal: PhRMA’s GLOBE Lawsuit and the New Economics of Pharma Supply Chains | Pharmaceutical Commerce](https://www.pharmaceuticalcommerce.com/view/supply-chain-signal-phrma-s-globe-lawsuit-and-the-new-economics-of-pharma-supply-chains) - Pharmaceutical Commerce