US President Joe Biden speaks about the January jobs report from the State Dining Room of the White House in Washington, DC, on February 4, 2022. - Despite a renewed onslaught of Covid-19 infections caused by the Omicron variant, the US economy added 467,000 jobs in January, the Labor Departmen said on February 4, 2022. The report, which also showed the unemployment rate rising slightly to four percent. (Photo by SAUL LOEB / AFP) (Photo by SAUL LOEB/AFP via Getty Images)
CNN  — 

President Joe Biden traveled to Virginia on Thursday to argue that his plan for lowering prescription drug prices would ease one of the largest financial burdens American families face at a time when they are coping with rising costs of food, gas and other necessities.

Hours after the government announced that a key inflation measure rose 7.5% in the 12 months ending in January, the steepest annual increase in 40 years, Biden acknowledged the impact on Americans and vowed to work to alleviate the surge in prices.

Biden also used the speech to highlight his administration’s efforts to lower health care costs and prescription drug prices – a key piece of his massive economic and climate package currently on ice on Capitol Hill. 

“Inflation is up. It’s up. And (I’m) coming from a family (that), when the price of gas went up, you felt it in the household. You knew what it was like. It matters,” Biden said in his remarks, which took place at Germanna Community College in Culpeper, Virginia. “But the fact is that if we are able to do the things I’m talking about here, it’ll bring down the costs for average families.”

The legislation, known as Build Back Better, revives the Democrats’ effort to allow Medicare to negotiate drug prices. It would empower the agency to negotiate the prices of certain costly medications administered in doctors’ offices or purchased at the pharmacy – up to 20 medications starting in 2028. It’s a far more limited proposal than the one House Democratic leaders have supported in the past.

Notably, Biden thanked Secretary of Health and Human Services Xavier Becerra, who attended Thursday’s event, for “answering my call when I asked him to come be the secretary.” He also credited Becerra for helping the administration make progress on Covid-19 vaccinations and encourage a record 14.5 million people to sign up for 2022 Affordable Care Act coverage, which was fueled by more generous federal subsidies the Democrats enacted last year.

This comes after Becerra told CNN he is looking to step into a bigger public role following accusations he’s been largely absent during the coronavirus pandemic. 

The President also praised several Virginia Democrats during his speech, including Democratic Rep. Abigail Spanberger, who represents the swing district where Biden’s remarks took place. Spanberger is up for reelection this fall, and Democrats are trying to hold on to their majorities in the House of Representative and the Senate. 

“In my Build Back Better legislation that, with Abigail’s leadership, passed the House of Representatives, we can (lower prescription drug prices). Now we just have to get it to the United States Senate. And we’re close. We can do even more to lower out-of-pocket insurance costs. We will hold drug prices accountable for the absurd price increases,” he said.

Democrats, including Biden, have long campaigned on lowering drug prices. Their latest attempt came as part of the party’s massive social safety net bill, which is the cornerstone of Biden’s domestic agenda. The President noted that one in four Americans who need prescription medication struggle to afford it.

In addition to allowing Medicare to negotiate the prices of certain costly medications, Build Back Better would also impose penalties if drug companies increase their prices faster than inflation. And it would redesign Medicare’s Part D drug plans so that seniors and people with disabilities wouldn’t pay more than $2,000 for medications bought at the pharmacy.

Biden also highlighted that the bill would cap what Americans pay for insulin at $35 a month, which he said was three-and-a-half times the cost of producing it.

About 10 fewer drugs would be introduced in the US market over the next three decades if the bill were enacted, the Congressional Budget Office projects. About 1,300 drugs are expected to be approved over that time period under current law, the agency said.

The bill also calls for blocking the implementation of a Trump administration regulation that would change the drug industry’s rebate system, though it isn’t set to go into effect until 2026. The rule effectively would ban drug makers from providing rebates to pharmacy benefit managers and insurers. Instead, drug companies would be encouraged to pass the discounts directly to patients at the pharmacy counter.

Altogether, the prescription drug measures would save around $297 billion, including about $79 billion from allowing Medicare to negotiate drug prices, according to the CBO. Prior House efforts to permit drug price negotiations would have saved far more.

Though Build Back Better negotiations have been at a standstill since Democratic Sen. Joe Manchin of West Virginia said in December that he could not support it, a coalition of more than 90 organizations representing patients, consumers, employers, unions, doctors, seniors and others have been pressuring senators to advance the drug price measures. Meanwhile, House Democrats and Sens. Bernie Sanders, an independent from Vermont, and Amy Klobuchar, a Minnesota Democrat, introduced legislation Wednesday that would enable Medicare to pay the same prices for drugs as the Veterans Administration, which is allowed to negotiate.

Biden railed against the high cost of drugs in a speech in August, where he also pushed for allowing Medicare to negotiate prices. His administration released a 29-page blueprint the following month that cites lack of competition as a chief factor behind high drug costs. 

CNN’s Betsy Klein contributed to this report.