Bush might actually use his veto pen, according to this wire service story:
President Bush vowed Thursday to veto Democratic-drafted legislation requiring the government to negotiate with drug companies for lower prices under Medicare.[...]
Republicans argue that individual insurance companies already negotiate lower prices on behalf of their customers and that the Democratic approach was tantamount to calling for federal price controls.
The legislation also would ban any attempt to limit the array of drugs available to Medicare beneficiaries by creating formularies. That stands in contrast to the Veterans Administration, which has lower prices for its beneficiaries but uses formularies that limit patient choice.
As annoying as formularies can be, they do play a useful role in negotiating lower prices. So although I can see where it seems foolish to prohibit Medicare from negotiating, I’m not sure that government-standardized prices across all meds is the best idea in the world either.