Drugmakers agree to negotiate Medicare prices

October 03, 2023

The manufacturers of the 10 drugs selected for the Medicare Drug Price Negotiation Program have agreed to take part in the new federal program, CMS said today.

The federal government recently announced the first 10 drugs selected for Medicare’s price negotiation program. The drugs are single-source products with no generic alternatives for diabetes, blood clotting, heart failure, Crohn's disease, and arthritis, among other uses.

On Tuesday, CMS announced all the selected manufacturers had committed to participate in the upcoming 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,” said CMS Administrator Chiquita Brooks-LaSure. “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.”

Here's what you need to know:

• The timeline:  Following listening sessions this fall, CMS will send initial “maximum fair price” offers for selected drugs by February 1. Negotiations will end August 2024, with prices published a month later. The negotiated prices will go into effect during 2026.
• The drugs:  The first selected products are Eliquis (blood clotting), Jardiance (diabetes), Xarelto (blood clotting), Januvia (diabetes), Farxiga (diabetes), Entresto (heart failure), Enbrel (autoimmune diseases), Imbruvica (blood cancers), Stelara (Crohn’s disease), and NovoLog (diabetes).
• Rationale:  The selected drugs accounted for $50.5 billion in total Part D gross covered prescription drug costs, representing 20 percent of total Part D gross covered prescription drug costs between June 1, 2022 and May 31, 2023.
• Legal considerations:  In a decision  last week, a federal judge ruled against the U.S. Chamber of Commerce, which sought an injunction to stop the drug negotiation program from moving ahead. The program still faces legal scrutiny from the pharmaceutical community.
• Quotable:  “We are pleased that all 10 drug companies will participate in Medicare drug price negotiations. We look forward to continuing this critical work to lower health care costs for the American people and ensure seniors don’t have to choose between paying for prescription drugs or putting food on the table,” said HHS Secretary Xavier Becerra.

Fact sheets from the Office of the Assistant Secretary for Planning and Evaluation and CMS are available online.

Additional information about the upcoming CMS listening sessions also is available.