Significant Advancement in Medicare as Costs for These 10 Expensive Medications Are Reduced
Brand-new Take:
The Biden administration shocked the health care sector last Thursday with the announcement of a deal struck with leading pharmaceutical giants set to slash the costs of 10 popular drugs for Medicare Part D users beginning January 1, 2026. American seniors will pocket a whopping $1.5 billion in savings once the new prices take effect, with Medicare saving an impressive $6 billion, according to a press release from the Department of Health and Human Services.
From drugs that combat heart disease, diabetes, and cancer, the list includes 10 of the priciest and most commonly used medications on the market. In the span of five years, from 2018 to 2023, their list prices skyrocketed up to 55%, as per HHS data.
Back in 2003, Congress passed a prescription drug bill barring Medicare from negotiating drug prices. The consequence? A significant increase in drug costs for consumers over two decades. Pharmaceutical companies could basically set any price they wanted and consumers either had to pay up or do without their vital medications.
But with the Inflation Reduction Act of 2022 now in the picture, that's all about to change. For starters, at least. Starting in 2026, 10 drugs will see reduced costs for Medicare Part D customers, with a further 15 more drugs to be negotiated by February 1, 2025, and their new prices effective in 2027. By 2029, Medicare will have negotiated prices for a total of 50 drugs, according to HHS.
A staggering 21% of older Americans find it hard to pay for prescription medications, but the drug companies haven't been willing future-planners. They've waged an all-out war against the negotiation provisions in the Inflation Reduction Act, filing numerous lawsuits to halt the negotiations – all of which have thus far been dismissed.
Here's the list of those 10 drugs that will see reduced costs first:
- Eliquis
- Jardiance
- Xarelto
- Januvia
- Farxiga
- Entresto
- Enbrel
- Imbruvica
- Stelara
- Fiasp; Fiasp FlexTouch; Fiasp PenFill; NovoLog; NovoLog FlexPen; NovoLog PenFill
Meena Seshamani, CMS Deputy Administrator and Director of the Center for Medicare, expressed her satisfaction with the agreement in a press release: “CMS negotiated in good faith on behalf of the millions of people who rely on these 10 drugs for their health and well-being. The new negotiated prices will bring much-needed financial relief, affordability, and access.”
Seshamani further noted that the process was carried out with openness and transparency, meeting with various stakeholders such as patients, providers, health plans, pharmacies, drug companies, and other interested parties to shape the negotiations. She assured that they will continue this practice for future rounds of negotiations.
- The reduction in prices for popular drugs for Medicare Part D users, expected to start in 2026, is a testament to the impact of technology and tech-driven policies, like the Inflation Reduction Act of 2022, in shaping the future of healthcare.
- In 2025, the Biden administration plans to negotiate prices for an additional 15 drugs, further demonstrating their commitment to addressing the rising costs of medicare, aiming for a total of 50 negotiated drugs by 2029.
- Predictions for 2025 indicate a significant shift in the pharmaceutical market, with the negotiation of drug prices becoming a reality, challenging the long-held and high pricing strategies of tech-savvy pharmaceutical companies.
- The 2026 reduction in prices for drugs like Eliquis, Jardiance, Xarelto, Januvia, Farxiga, Entresto, Enbrel, Imbruvica, Stelara, and Fiasp, among others, signifies a move towards true affordability in the healthcare sector, ensuring medicare recipients can access essential medication without breaking the bank.
