Latest Medicare drug negotiations to save $12 billion
Add Axios as your preferred source to
see more of our stories on Google.
Illustration: Aïda Amer/Axios
Medicare has negotiated list price reductions of up to 85% for 15 widely used drugs in the program, including Novo Nordisk's blockbuster GLP-1 drug Ozempic, officials announced Tuesday.
Why it matters: The price cuts are expected to save $12 billion over a year. Seniors are expected to see a $685 million reduction in out-of-pocket costs when they take effect in 2027.
State of play: While President Trump has struck deals with individual drug companies to lower the prices of a broad range of medicines, his administration has has concurrent talks with manufacturers of high-cost popular Medicare drugs.
- The Medicare drug price negotiations stemmed from the Inflation Reduction Act. The first set of negotiated prices for 10 drugs, including blood thinner Eliquis and diabetes drug Jardiance, will take effect on Jan. 1.
- "We have achieved substantially better outcomes for taxpayers and seniors in the Medicare Part D program — not the modest or even counterproductive 'deals' we saw before," CMS administrator Mehmet Oz said in a statement.
- An increase in overall savings was expected, since Medicare negotiated prices for an additional five drugs this time.
Medicare negotiated a list price of $274 for a month's supply of Ozempic and its related medications, Wegovy and Rybelsus — a 71% discount from the 2024 list price of $959, per the Centers for Medicare and Medicaid Services.
- However, Trump announced earlier this month that Novo Nordisk and its rival Eli Lilly will decrease the price Medicare pays for a month's supply of GLP-1 drugs to $245.
- CMS, the Department of Health and Human Services and the White House did not immediately respond to questions about the discrepancy.
- A Novo Nordisk spokesperson said Tuesday that the company continues to have "serious concerns" about the price negotiation program's downstream impacts.
The other drugs and negotiated prices were:
- Xtandi, a drug used to treat prostate cancer from Astellas and Pfizer: $7,004, a 48% discount for a 30-day supply from the 2024 list price.
- Trelegy Ellipta, a prescription inhaler made by GlaxoSmithKline: $175, a 73% decrease.
- Pomalyst, used to treat cancer and AIDS-related sarcoma and made by Bristol Myers Squibb: $8,650, a 60% decrease.
- Ibrance, a Pfizer drug for breast cancer: $7,871, a 50% decrease.
- Ofev, a lung disease drug from Boehringer Ingelheim: $6,350, a 50% decrease.
- Linzess, a treatment for irritable bowel syndrome from AbbVie and Ironwood: $136, a 75% decrease.
- Calquence, an AstraZeneca drug for blood cancer: $8,600, a 40% decrease.
- Austedo and Austedo XR, Teva's drug to treat symptoms of Huntington's disease: $4,093, a 38% discount.
- Breo Ellipta, another inhaler from GSK: $67, an 83% discount.
- Tradjenta, a drug for Type 2 diabetes made by Boehringer Ingelheim: $78, an 84% discount.
- Xifaxan, also used for IBS treatment, from Salix and Bausch: $1,000, a 63% discount.
- Vraylar, an antipsychotic from AbbVie: $770, a 44% discount.
- Janumet and Janumet XR, a Merck drug for type 2 diabetes: $80, an 85% discount.
- Otezla, a psoriasis drug from Amgen: $1,650, a 65% discount.
What's next: Medicare officials are expected to select another 15 drugs for the next round of negotiations by Feb. 1.
Go deeper: Dems seek to expand drug price negotiations
