U.S. President Joe Biden talks about prescription drug costs during an event at NHTI Concord Community College in Concord, New Hampshire, USA, on October 22, 2024.
Elisabeth Franz | Reuters
The Biden administration on Friday announced the next 15 prescription drugs to be subject to price controls negotiation Collaboration between manufacturers and Medicare to launch second phase A milestone journey The aim is to make expensive medications more affordable for seniors.
Topping the list is Novo NordiskBlockbuster diabetes injection Ozempic, weight loss injection Wegovy and diabetes drug Rybelsus are all considered to be among the products under negotiation Because they all have the same active ingredient: semaglutide. These treatments have fueled the rise of the red-hot obesity market, but are difficult for patients to access due to cost, insurance coverage and supply constraints.
Agreed prices for the second wave of medicines are scheduled to come into effect in 2027.
Here are 15 drugs in preliminary negotiations this year:
- Semaglutide (Ozempic, Wegovy, Rybelsus) produced by Novo Nordisk for the treatment of type 2 diabetes, weight management and cardiovascular health
- Trelegy Ellipta, manufactured by GSK, is an inhaler used to treat chronic obstructive pulmonary disease and asthma
- Xtandi, made by Pfizer, is used to treat prostate cancer in men
- Pomalyst, made by Bristol Myers Squibb, is used to treat a blood cancer called multiple myeloma and a cancer that occurs in people with HIV
- Ibrance, made by Pfizer, used to treat certain breast cancers
- Ofev is manufactured by Boehringer Ingleheim and is used to treat chronic lung disease in adults.
- Linzess, produced by AbbVie and Ironwood Pharmaceuticals, is used to treat irritable bowel syndrome and chronic constipation.
- Calquence is made by AstraZeneca and is used to treat certain types of blood cancers
- Austedo, Austedo XR, made by Teva Pharmaceuticals, is used to treat involuntary movements caused by tardive dyskinesia, or Huntington’s disease
- Breo Ellipta, produced by GSK and Theravance, is an inhaler used to treat chronic obstructive pulmonary disease
- Tradjenta is manufactured by Boehringer Ingelheim and Eli Lilly and Company for the management of type 2 diabetes
- Xifaxan is manufactured by Salix Pharmaceuticals and is used to treat diarrhea caused by travel or irritable bowel syndrome.
- Vraylar is manufactured by AbbVie and is used to treat schizophrenia, bipolar I disorder and major depression.
- Janumet, Janumet XR, manufactured by Merck & Co., is used to treat type 2 diabetes
- Otezla, made by Amgen, is used to treat plaque psoriasis, psoriatic arthritis and canker sores
President Joe Biden’s Inflation Lowering Act gives Medicare the power to negotiate drug prices directly with manufacturers for the first time in the federal program’s nearly 60-year history. Some congressional Democrats and consumer advocates have long pushed for the change as many seniors across the country struggle to afford health care.
According to statistics, between November 1, 2023 and October 31, 2024, about 5.3 million people with Medicare Part D coverage used these 15 drugs in their second round of interviews to treat various conditions, such as asthma , cancer and type 2 diabetes. The release added that this group of drugs also accounted for approximately $41 billion, or 14%, of total Part D prescription drug costs during that period.
Combined with the 10 drugs selected in the first round of negotiations, these 25 products accounted for 36% of all Medicare Part D prescription drug costs during that period, the release said.
The drugs have been on the market without generic competitors for at least seven years, and in the case of biologics such as vaccines, 11 years.
Medicare has completed negotiations on the first 10 drugs selected for the program, with new prices set to take effect next year. In August, the Biden administration said it expected these negotiated prices to assist Medicare enrollees US$1.5 billion That’s just the out-of-pocket costs in 2026 alone. The government also expects the price increases to bring about $6 billion in net savings to the Medicare program 2026which is an overall net saving of 22%.
But it’s unclear whether President-elect Donald Trump will try to change or scale back parts of the law when he takes office next week.
The negotiating plan also faces a series of legal challenges (so far unsuccessful) from the pharmaceutical industry, which sees the process as a threat to its revenue growth, profits and drug innovation.
Medicare covers approximately 66 million people in the United States. 50.5 million Patients are currently enrolled in Part D plans, according to KFF, a health policy research organization.
A senior government official told reporters last year that nearly 10% of Medicare enrollees age 65 and older and 20% of those under 65 said they faced difficulties purchasing medications.
“Last year we proved that negotiating lower drug prices works. Now we plan to build on that success.”
U.S. Department of Health and Human Services Secretary Xavier Becerra said in a press release that a record number of 15 important drugs for seniors were negotiated to lower prices. The announcement is critical—the Inflation Reduction Act is lowering prices for people with Medicare. The U.S. Department of Health and Human Services will continue to negotiate in the best interests of Medicare patients to obtain innovative, life-saving treatments at lower costs.
Patient advocacy groups including the nonprofit American Association of Retired Persons applauded the news Friday.
“For too long, Big Pharma has boosted profits by setting outrageous prices at the expense of American lives, forcing seniors to give up prescription drugs they can’t afford,” AARP said in a statement. “Sec. A round of Medicare drug price negotiations made clear that this process will lower prices for these important products and save Medicare and its beneficiaries billions of dollars.”
What’s next for Medicare price negotiations?
Drugmakers have until February 28 to decide whether to participate in the program. If a drugmaker refuses to negotiate, it must pay an excise tax of up to 95% of U.S. sales of its drugs or withdraw all its products from the Medicare and Medicaid markets.
Those involved will engage in a lengthy negotiation process involving months of back-and-forth quotes with Medicare. The federal program uses information such as sales data, the level of federal financial support for drug development, and pending or approved patent applications and exclusivity data to determine the initial offer price for each drug.
After the second round, Medicare can negotiate prices for 15 more drugs that will go into effect in 2028.
The government will select only Medicare Part D drugs for the first two rounds of negotiations. By 2028, it will add more specialty drugs covered by Medicare Part B, which are typically administered by doctors.
But drug companies will have more opportunities to negotiate with Medicare, based on final guidance The second round of price negotiations was released last year. The first optional negotiation meeting will be held after Medicare makes an initial offer for 15 drugs, which must be June 1.
