Company: CERO
Filing Date: 2025-11-19
Form Type: 10-Q
Source: 0001213900-25-112619
Chunk: 435

Company: CERO THERAPEUTICS HOLDINGS, INC.
Filing Date: 2025-11-19
Form: 10-Q
Item: Item 4
Chunk 435
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 if they are approved. Prior to the enactment of the One Big Beautiful Bill Act of 2025 (“OBBBA”), orphan drugs
were exempt from Medicare price negotiation under the IRA only if they had received a single orphan designation and were approved solely
for the corresponding rare disease or condition. The OBBBA amended this exemption to apply more broadly: now, any orphan-designated drug
is exempt from price negotiation, regardless of the number of orphan designations it has received, provided the drug’s approved
indications are exclusively for those rare diseases. The OBBBA also included significant reforms to Medicaid, including an estimated
$1 trillion in reduced federal Medicaid spending from 2025 through 2034, the imposition of work requirements for certain adult enrollees,
more frequent eligibility redeterminations, and increased cost-sharing for beneficiaries. These changes are expected to reduce overall
Medicaid enrollment and access to care. Although the effect on our future product candidates or business is unknown, any decrease in
the number of insured patients or reimbursement levels for our products could adversely affect our potential for revenue and our commercial
prospects.

In addition, multiple executive
actions in the first half of 2025 signal the federal government’s increasing focus on lowering prescription drug prices, adding
to the uncertainty surrounding future drug pricing and reimbursement frameworks. For example:

    ●
    On
    May 12, 2025, President Trump signed the executive order titled “Delivering Most-Favored-Nation Prescription Drug Pricing,”
    which directs the Secretary of Health and Human Services (“HHS”) to identify and communicate most-favored-nation price
    targets for prescription drugs and to propose a rulemaking plan to impose such pricing if “significant progress” is not
    made. The order also directs the federal government to explore regulatory pathways that would facilitate direct-to-patient sales
    for manufacturers that meet these price targets. Additionally, it signals potential further action against manufacturers that fail
    to offer most-favored-nation pricing, including evaluating whether to modify or rescind marketing approvals or allow individual drug
    importation waivers. In July 2025, President Trump sent letters to pharmaceutical companies demanding further reduced prices more
    in line with most-favored-nation pricing. On September 30, 2025, the White House announced the first MFN agreement (Pfizer), and
    reports indicate additional negotiations are ongoing. The scope, timing, and ultimate impact of any further actions or agreements
    remain uncertain