The Centers for Medicare and Medicaid Services announced lower prices for 15 costly prescription drugs under Medicare, including Ozempic and Wegovy. The cuts come through the Medicare drug price negotiation program created by the Inflation Reduction Act signed into law in 2022.
This program differs from former President Trump’s “most favored nation” approach, which used executive actions and voluntary deals with drugmakers rather than legislation. Trump recently announced a separate deal with Novo Nordisk, the maker of Ozempic and Wegovy, to lower prices in exchange for tariff relief. The Trump administration has otherwise been largely quiet about the Medicare negotiation program.
This is the second round of negotiations. Last year the administration reached deals on 10 drugs for heart disease and diabetes; those price cuts take effect in 2026. The new round of negotiated prices will take effect in 2027.
Health and Human Services Secretary Robert F. Kennedy Jr. said in a news release that the administration will “use every tool at our disposal to deliver affordable health care to seniors.” Drugmakers can decline to strike deals, but doing so would likely mean withdrawing their drugs from Medicare — cutting them off from a major market. Drugmakers have challenged the program in court but have not succeeded so far.
The negotiated prices are what Medicare will pay drugmakers, not the direct out-of-pocket price patients pay. CMS estimates the discounts will save taxpayers $12 billion and are expected to reduce Medicare enrollees’ out-of-pocket costs by $685 million in 2027.
Negotiated 30-day prices compared with 2024 list prices:
– Ozempic, Rybelsus and Wegovy (Type 2 diabetes and weight loss): $274 negotiated, down from $959. (Higher Wegovy doses: $385.)
– Trelegy Ellipta (asthma): $175, down from $654.
– Xtandi (prostate cancer): $7,004, down from $13,480.
– Pomalyst (chemotherapy): $8,650, down from $21,744.
– Ofev (idiopathic pulmonary fibrosis): $6,350, down from $12,622.
– Ibrance (breast cancer): $7,871, down from $15,741.
– Linzess (chronic constipation): $136, down from $539.
– Calquence (cancer): $8,600, down from $14,228.
– Austedo and Austedo XR (Huntington’s disease): $4,093, down from $6,623.
– Breo Ellipta (COPD): $67, down from $397.
– Xifaxan (diarrhea and irritable bowel syndrome): $1,000, down from $2,696.
– Vraylar (antipsychotic): $770, down from $1,376.
– Tradjenta (diabetes): $78, down from $488.
– Janumet and Janumet XR (diabetes): $80, down from $526.
– Otezla (psoriatic arthritis): $1,650, down from $4,722.
These 15 drugs represented $42.5 billion, or about 15% of total Medicare Part D spending in 2024. Part D covers medications taken at home rather than those administered in facilities like IV chemotherapy.
Stacie Dusetzina, a health policy professor at Vanderbilt University, called the negotiations “very reasonable,” saying they should provide relief for taxpayers and beneficiaries over time. She noted the $274 price for Ozempic and Wegovy is slightly higher than the $250 price in Trump’s deal and suggested that the lower figure would have been preferable for taxpayers and beneficiaries.
The price cuts come amid widespread concern about drug affordability. A July survey by KFF found about 1 in 5 adults have skipped filling a prescription because of cost, and about 1 in 7 have cut pills in half or skipped doses in the past year due to expense.
