HHS Releases First 10 Drugs Eligible for Medicare Price Negotiation
Following through on the Inflation Reduction Act provisions, the Biden-Harris Administration will begin Medicare price negotiations with the drug companies this fall.
Updated 10/3/2023: This article has been updated to include the drug companies' decisions to participate in the negotiation process.
HHS has announced the first ten drugs that will be available for Medicare price negotiation starting in 2026.
The negotiations with the drug companies will take place in 2023 and 2024, with CMS set to release the new prices on September 1, 2024. The prices will take effect on January 1, 2026.
Medicare beneficiaries paid $3.4 billion in out-of-pocket costs in 2022 for the selected drugs. The ten drugs chosen for the first round of negotiation are as follows:
- Eliquis
- Jardiance
- Xarelto
- Januvia
- Farxiga
- Entresto
- Enbrel
- Imbruvica
- Stelara
- Fiasp; Fiasp FlexTouch; Fiasp PenFill; NovoLog; NovoLog FlexPen; NovoLog PenFill
These drugs treat various conditions, including blood clots, diabetes, heart failure, chronic kidney disease, rheumatoid arthritis, blood cancers, Psoriasis, and Crohn’s disease. Costs for the drugs between June 2022 and May 2023 ranged from $2.57 billion for Fiasp and NovoLog drugs to $16.4 billion for Eliquis.
Together, the ten drugs accounted for $50.5 billion in total Part D gross prescription drug costs, or 20 percent of the total expenses.
Eliquis was the most commonly used drug between June 2022 and May 2023, with 3.7 million Medicare beneficiaries. Jardiance and Xarelto both had over 1 million users, while the remaining seven drugs had between 20,000 and 869,000 users.
The price negotiation process will consider the drugs’ clinical benefits, the extent to which they resolve unmet medical needs, their impact on Medicare beneficiaries, and the costs related to research, development, production, and distribution.
Per Inflation Reduction Act provisions, CMS will select 15 more Part D drugs for negotiation for 2027, 15 more Part D or Part B drugs for 2028, and 20 more for each year after that.
“For far too long, pharmaceutical companies have made record profits while American families were saddled with record prices and unable to afford life-saving prescription drugs. But thanks to the landmark Inflation Reduction Act, we are closer to reaching President Biden’s goal of increasing availability and lowering prescription drug costs for all Americans,” HHS Secretary Xavier Becerra said in the press release.
Drug companies have pushed back against the Inflation Reduction Act and the price negotiation policies, but Secretary Becerra said the Biden-Harris Administration is committed to lowering prescription drug prices and improving access for beneficiaries.
By October 1, 2023, the drug companies must decide whether to sign agreements to participate in the negotiation process. The companies must submit manufacturer-specific data to CMS by October 2 for the agency to consider it in the negotiations. CMS will invite the participating drug companies to discuss the data submission this fall.
Additionally, CMS will hold patient-focused listening sessions for each selected drug, consisting of engagement from patients, beneficiaries, caregivers, consumer organizations, and other parties interested.
On October 3, 2023, CMS announced that all ten drug companies have chosen to participate in the negotiation process.
“We look forward to engaging with the drug manufacturers of the selected drugs that have decided to participate in the Medicare Drug Price Negotiation Program,” CMS Administrator Chiquita Brooks-LaSure said in a statement. “Our goal is to ensure access to innovative treatments and therapies for people that need them when they need them. Medicare will negotiate in good faith consistent with the requirements of the law on behalf of people with Medicare."
