- The initial set of 10 prescription drugs to undergo price negotiations between manufacturers and Medicare has been revealed by the Biden administration.
- This announcement marks the beginning of a contentious procedure outlined in the Inflation Reduction Act, which seeks to enhance accessibility to expensive medications for elderly Americans.
- Among the listed medications are Bristol-Myers Squibb’s blood thinner Eliquis, Johnson & Johnson’s blood thinner, Novo Nordisk’s insulin products, and Merck’s diabetes drug Januvia.
The Biden administration has revealed the first batch of 10 prescription drugs slated for price negotiations with manufacturers and Medicare. This marks a significant step in the administration’s bid to make expensive medications more affordable for older Americans. The Inflation Reduction Act, championed by President Joe Biden and passed along party lines last year, granted Medicare the authority to directly engage in pricing discussions with drug manufacturers for the first time in nearly six decades of the federal program’s existence. The agreed-upon prices for these initial drugs are set to take effect in 2026.
Here is the list of the 10 drugs subject to initial negotiations this year:
- Eliquis, produced by Bristol-Myers Squibb, used for clot prevention and stroke risk reduction.
- Jardiance, manufactured by Boehringer Ingelheim, employed for lowering blood sugar in Type 2 diabetes patients.
- Xarelto, developed by Johnson & Johnson, utilized for blood clot prevention and stroke risk reduction.
- Januvia, from Merck, prescribed for lowering blood sugar in Type 2 diabetes patients.
- Farxiga, created by AstraZeneca, used in treating Type 2 diabetes.
- Entresto, designed by Novartis, employed for certain heart failure types.
- Enbrel, produced by Amgen, utilized for rheumatoid arthritis treatment.
- Imbruvica, crafted by AbbVie, employed for various blood cancer types.
- Stelara, by Janssen, used to manage Crohn’s disease.
- Fiasp and NovoLog, insulins from Novo Nordisk.
This move to negotiate drug prices is a central component of the Biden administration’s strategy to curb the escalating medication costs in the United States. Many Democrats in Congress and consumer advocates have long advocated for such changes, given the financial struggles many seniors face in affording essential healthcare.
President Biden emphasized the significance of this step, stating, “Today is the start of a new deal for patients, so big pharma doesn’t just get a blank check at your expense – at the expense of the American people. On my watch, health care should be a right, not a privilege, in this country.”
However, the pharmaceutical industry perceives this process as a challenge to its revenue growth, profits, and innovation. Companies like Merck and Johnson & Johnson, supported by their allies, have lodged several lawsuits recently with the aim of declaring the policy unconstitutional.
These drugs were among the top 50 with the highest Medicare Part D spending, covering prescription medications seniors acquire from retail pharmacies. These 10 medications collectively accounted for around 20% of the total Part D prescription drug costs from June 2022 to May 2023, as reported by the Centers for Medicare and Medicaid Services (CMS).
The next steps involve drugmakers signing agreements to participate in the negotiations by October 1. CMS will present an initial price offer to manufacturers in February 2024, allowing a month for acceptance or counteroffers. The negotiation process is slated to conclude in August 2024, with the agreed-upon prices publicized on September 1, 2024. These reduced prices will then become effective in January 2026.
The Biden administration anticipates that these negotiations will save Medicare approximately $98.5 billion over a decade. This effort is also expected to reduce costs for Medicare beneficiaries, who often struggle with out-of-pocket expenses for medications.
Despite the legal challenges posed by pharmaceutical companies, the Biden administration is determined to press on with these negotiations. President Biden views these lawsuits as indicators of progress in the fight against exorbitant drug prices.
In the end, this move holds potential to reshape the landscape of medication affordability in the U.S., potentially benefiting millions of Americans while triggering considerable industry contention and legal battles.
Call or text us at 203.433.4969 or just “ask Steve” through our website. Shorelineinsurancect.com
