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Medicare announced Friday that it has selected 15 drugs, including the hugely popular medications Ozempic and Wegovy, used for diabetes and weight loss, as well as some blockbuster cancer medications and other drugs, for its second round of price talks.
Together with the first 10 drugs that the Biden administration targeted for its Medicare Drug Price Negotiation Program last year, the medications make up a third of prescription drug spending in the government insurance program for seniors.
Prices negotiated in this second round of talks are slated to take effect in 2027. The drugs announced Friday by the Biden administration are:
- Novo Nordisk’s Ozempic; Rybelsus; Wegovy
- GSK’s Trelegy Ellipta
- Astellas and Pfizer’s Xtandi
- Bristol-Myers Squibb’s Pomalyst
- Pfizer’s Ibrance
- Boehringer Ingelheim’s Ofev
- AbbVie and Ironwood’s Linzess
- AstraZeneca’s Calquence
- Teva’s Austedo; Austedo XR
- GSK’s Breo Ellipta
- Boehringer Ingelheim’s Tradjenta
- Salix’s Xifaxan
- AbbVie’s Vraylar
- Merck’s Janumet; Janumet XR
- Amgen’s Otezla
Under the program’s timeline, drugmakers have until Feb. 28 to decide whether to either participate in the talks or face a hefty tax if they want to stay covered by Medicare and Medicaid.
Close to 2.3 million seniors in Medicare are using the semaglutide medications, branded as Ozempic, Rybelsus and Wegovy by Novo Nordisk. Medicare says that the drug added up to more than $14 billion covered by the program over the last year, the most of any medication in this round.
The next costliest was GSK’s asthma and chronic obstructive pulmonary disease medication Trelegy Ellipta, at around $5.1 billion. Around 1.25 million seniors are using that drug.
The White House says the first round of negotiations lowered the price of some of the most commonly used drugs in Medicare by about 40% to 80% compared to their list price, though researchers estimate the actual savings were significantly smaller for many drugs. Those reduced prices go into effect next year.
President Biden has touted the program, created by the Inflation Reduction Act he signed into law in 2022, as one of his term’s signature accomplishments.
Drugmakers have sought in court to stop the process. Industry groups and Republicans have blasted the “price-setting scheme” as unfair and discouraging innovation.
Dispute over covering weight loss drugs
The new round of talks come as the Biden administration has also proposed expanding Medicare coverage to weight loss drugs, which is currently not allowed. It will be up to the incoming Trump administration to decide whether and how to finalize the move.
Medicare officials say the negotiated prices for these drugs would apply for their use in treating obesity too, if the incoming Trump administration decides to go forward with the proposed rule.
“So much of the health care world now sees obesity as a disease itself. And that is what drove our decision making, that it is the role of Medicare and Medicaid to cover the health services that people need,” Centers for Medicare and Medicaid Services Administrator Chiquita Brooks-LaSure told CBS News.
A Novo Nordisk spokesperson said the company remained opposed to the talks, which it is suing to overturn, and pledged to “work with the incoming administration” to address its concerns.
“That is why we are deeply concerned about the price-setting process, which could negatively impact patients’ ability to access their medicines and threatens to stifle future scientific development of life-changing medicines,” the spokesperson said in a statement.
The drugmaker also criticized Medicare’s grouping of Wegovy, Ozempic and Rybelsus together, arguing that they would not qualify for the drug talks individually. Brooks-LaSure defended Medicare’s move to group the three together, saying the “law is very clear.”
“Wegovy, Ozempic, they all have the same active ingredient. That’s how the law was written, and that is what we implemented,” she said.
Can Trump change or halt the process?
It is unclear whether President-elect Donald Trump would seek to change the drugs picked or stop the talks after he takes office. On the campaign trail, he often pledged not to make cuts to Medicare after Democrats sought to tie him to a “Project 2025” proposal to undo the program.
Speaking with reporters on Thursday, a senior Biden administration official said that the process to pick the drugs for the negotiation program was hemmed in by the law Congress passed.
That law requires Medicare to essentially make a list of eligible drugs for the program, and then select the drugs that make up the 15 highest in spending from Part D.
“That process, again, is clearly defined in statute. There is no ability for a policy official to say, I prefer this drug over that drug. The entire process is based on these data,” the official said.
A spokesperson for the president-elect did not respond to a request for comment.
The bulk of staff working on the negotiation program are career staff running the talks, Brooks-Lasure said, not political appointees who will leave during the transition.
“There is so much technical information that is passed back and forth during that negotiation and that is largely done by people who will stay here,” said Brooks-Lasure.
“We have got to get a handle on prescription drug costs in this country, and it’s crucial that Medicare, the CMS staff are negotiating lower prices. It’s important for the people taking the drugs. It’s also important for the entire Medicare program. We want to make sure this program is here for us and our children,” she said.
Which drugs were selected for the first round?
The Biden administration announced the 10 drugs selected for the first round of the Medicare Drug Price Negotiation Program in August 2023, and reached an agreement in August 2024.
The negotiated prices will take effect in 2026. Those drugs are:
- Merck Sharp Dohme’s Januvia
- Novo Nordisk’s Fiasp and NovoLog
- AstraZeneca’s Farxiga
- Immunex’s Enbrel
- Boehringer Ingelheim’s Jardiance
- Janssen’s Stelara
- Janssen’s Xarelto
- Bristol Meyers Squibb’s Eliquis
- Novartis’ Entresto
- Pharmacyclics’ Imbruvica
CMS estimated last year that the savings they negotiated from the program would save around $1.5 billion for beneficiaries and $6 billion for the Medicare program.
