Centers for Medicare and Medicaid Services on Tuesday announced lower prices for 15 Expensive Prescription Drugs under Medicare, including Ozempic and Wegovy.
The price reductions come from the Medicare Drug Price Negotiation Program, created by the Medicare program. Inflation Reduction Actwhich President Joe Biden signed into law in 2022.
This is different from President Donald Trump. Drug pricing based on the “most favored nation” principlewhich relies on executive orders and voluntary agreements with drug manufacturers rather than legislation. Trump recently announced this deal with Novo Nordiskmanufacturer of Ozempic and Wegovy, lower drug prices in exchange for tariff benefits.
The Trump administration has remained largely silent on the Medicare price negotiation program.
This is the second round of negotiations. Last year, the Biden administration concluded deals for 10 prescription drugsincluding several for heart disease and diabetes. The price cuts are due to take effect in 2026. The latest round of price negotiations will take effect in 2027.
“President Trump has directed us to stop at nothing to lower health care costs for the American people,” said Health and Human Services Secretary Robert F. Kennedy Jr. in a statement. stated in the press release. “As we work to make America healthy again, we will use every tool at our disposal to provide affordable health care to seniors.”
Drugmakers could refuse to enter into deals under the negotiated program, but that would likely mean taking their drugs out of Medicare, cutting them off from one of the country's largest markets. Drug manufacturers have challenged the program in court, but so far have been unsuccessful.
Negotiated prices are what Medicare will pay drug makers for the drugs, not what patients will pay out of pocket. These rebates will save taxpayers $12 billion, according to CMS. This is expected to save Medicare beneficiaries $685 million in out-of-pocket costs in 2027.
Here are the negotiated prices for medicinesBased on 30 day supply versus 2024 list price:
- Ozempic, Rybelsus and Wegovy for Type 2 Diabetes and Weight Loss: Negotiated price $274 compared to list price of $959. (Contract prices for higher doses of Wegovy are $385.00.)
- Trelegy Ellipta, an asthma treatment: $175, down from $654.
- Xtandi, for prostate cancer: $7,004, down from $13,480.
- Pomalyst, a chemotherapy drug: $8,650, down from $21,744.
- Ofev, for idiopathic pulmonary fibrosis: $6,350 compared to $12,622.
- Ibrance, a breast cancer drug: $7,871, down from $15,741.
- Linzess, a chronic constipation medication: $136, down from $539.
- Calquence, a cancer drug: $8,600, down from $14,228.
- Austedo and Austedo XR for Huntington's disease: $4,093, down from $6,623.
- Breo Ellipta, a COPD drug: $67, down from $397.
- Xifaxan for Diarrhea and Irritable Bowel Syndrome: $1,000, down from $2,696.
- Vraylar, an antipsychotic: $770, down from $1,376.
- Tragenta, a diabetes drug: $78, down from $488.
- Janumet and Janumet XR, diabetes medications: $80, down from $526.
- Otezla, a psoriatic arthritis drug: $1,650, down from $4,722.
These 15 drugs accounted for $42.5 billion, or 15%, of total Medicare Part D spending in 2024. Medicare Part D covers medications that people take at home, not those administered in a facility, such as intravenous chemotherapy.
“The price negotiations seem very reasonable to me,” said Stacy Dusetsina, a health policy professor at Vanderbilt University in Nashville, Tennessee. “We hope this will bring some relief to taxpayers and beneficiaries in the long term.”
Dusetsina said the negotiated price for Ozempic and Wegovy of $274 is higher than the $250 price in Trump's deal. “They should have made this deal for taxpayers and Medicare beneficiaries,” she said.
The price cuts come as many Americans say the cost of prescription drugs is unaffordable.
According to the data, about one in five adults did not fill a prescription because it was too expensive. poll released in July by health policy research group KFF.. Around one in seven say they have cut their pill intake in half or skipped medication over the past year because of the cost.
