The US government has selected 15 top-selling prescription drugs for price negotiations as part of the Inflation Reduction Act (IRA) program, aimed at lowering medication costs for seniors and disabled individuals. The selected medications are prescribed to approximately 5.3 million Medicare beneficiaries to treat various conditions.
The first round of ten drugs negotiated between August 2023 and August 2024 resulted in an estimated 22% decrease in net government spending on pharmaceuticals. The next 15 selected this week will also see price erosion due to the redesigned Part D pharmacy benefit, expected to save Medicare beneficiaries $1.5 billion in out-of-pocket costs.
The drug pricing provisions aim to reduce Medicare beneficiaries’ cost burden by negotiating prices through government-led negotiations and redesigning the outpatient pharmacy benefit. Lowering list prices for products like Wegovy could pave the way for possible insurance coverage of weight loss drugs in Medicare.
However, it remains unclear if the incoming Trump administration will try to repeal or modify the IRA’s drug pricing provisions, including potentially implementing international benchmarking of prices or lifting the prohibition on coverage of obesity drugs. The Biden administration’s nominee for CMS administrator, Mehmet Oz, has expressed support for weight loss medications, while Robert F. Kennedy Jr., his potential boss, has been a vocal critic.
Source: https://www.forbes.com/sites/joshuacohen/2025/01/18/medicares-selection-of-15-more-drugs-for-price-negotiation-puts-spotlight-back-on-ira