Medicare drug price negotiations include Ozempic in the next round. Here are the 15 medications.

• Medicare will negotiate prices for the next 15 prescription drugs with the Biden administration.
• The second phase of a landmark provision in the Inflation Reduction Act commences, with the aim of making costly medications more affordable for seniors.
• Novo Nordisk's diabetes injection Ozempic, weight loss shot Wegovy, and diabetes pill Rybelsus, which all contain the same active ingredient, semaglutide, are considered one product.

On Friday, the Biden administration announced the next 15 prescription drugs to be included in price negotiations between manufacturers and Medicare, marking the start of the second phase of a groundbreaking initiative aimed at making expensive medications more affordable for seniors.

The three most popular treatments for diabetes and weight loss, Ozempic, Wegovy, and Rybelsus, are being discussed as a single product since they all contain the same active ingredient, semaglutide. These treatments have contributed to the growth of the obesity market but have been challenging for patients to obtain due to high costs, insurance coverage issues, and supply constraints.

The scheduled implementation of the agreed-upon prices for the second wave of drugs in 2027 may be affected by President-elect Donald Trump's potential attempts to modify or reduce certain provisions of the law when he assumes office next week.

Here are the 15 drugs subject to the initial talks this year:

• Novo Nordisk's Ozempic, Wegovy, and Rybelsus (semaglutide) are used for managing Type 2 diabetes, weight loss, and improving cardiovascular health.
• An inhaler known as Trelegy Ellipta, produced by , is utilized for managing chronic obstructive pulmonary disease and asthma.
• Xtandi, made by , is used to treat prostate cancer in men
• Multiple myeloma and HIV-associated cancer are treatable with Pomalyst, which is manufactured by.
• Ibrance, made by Pfizer, is used to treat certain breast cancers
• Boehringer Ingelheim's Ofev is used to treat chronic lung diseases in adults.
• Irritable bowel syndrome and chronic constipation can be treated with Linzess, which is produced by and.
• Calquence, made by , is used to treat certain types of blood cancer
• Austedo XR, manufactured by , is utilized to manage involuntary movements resulting from tardive dyskinesia or Huntington's disease.
• An inhaler known as Breo Ellipta, manufactured by GSK, is utilized for the treatment of chronic obstructive pulmonary disease.
• Boehringer Ingelheim's Tradjenta is used for managing Type 2 diabetes.
• Diarrhea resulting from travel or irritable bowel syndrome can be treated with Xifaxan, a medication produced by Salix Pharmaceuticals.
• AbbVie's Vraylar is used to treat schizophrenia, bipolar I disorder, and major depressive disorder.
• Type 2 diabetes can be managed with Janumet and Janumet XR, which are produced by.
• The medication Otezla, produced by, is utilized to treat plaque psoriasis, psoriatic arthritis, and oral ulcers.

Medicare now has the authority to negotiate drug prices with manufacturers directly, thanks to President Joe Biden's Inflation Reduction Act. This marks the first time in nearly 60 years that the federal program has had such power. Many seniors across the country have long advocated for this change, as they struggle to afford care.

According to a release from the Department of Health and Human Services, 5.3 million people with Medicare Part D coverage used 15 drugs in the second round of talks to treat various conditions, such as asthma, cancer, and Type 2 diabetes, between Nov. 1, 2023, and Oct. 31, 2024. These drugs accounted for approximately $41 billion, or 14%, of total Part D prescription drug costs during that time period.

During the first cycle of negotiations, the 25 products combined with the 10 medications accounted for 36% of all Medicare Part D prescription drug costs, according to the release.

Generic competitors have not been available for at least seven years for drugs, and 11 years for biological products like vaccines.

Medicare has completed negotiations for the first 10 drugs in the program, with new prices set to take effect next year. The Biden administration anticipates that these negotiated prices will save Medicare enrollees approximately $1.5 billion in out-of-pocket costs in 2026. Additionally, the government expects these prices to result in around $6 billion in net savings for the Medicare program in 2026, or 22% net savings overall.

The pharmaceutical industry has unsuccessfully challenged the negotiation program through legal means, viewing it as a threat to their revenue growth, profits, and drug innovation.

Approximately 66 million individuals in the U.S. are covered by Medicare, with 50.5 million of them enrolled in Part D plans, according to data from the health policy research organization KFF.

Last year, a senior administration official disclosed that nearly 10% of Medicare enrollees aged 65 and older, and about 20% of those under 65, face difficulties in affording medications.

"HHS Secretary Xavier Becerra announced that the Inflation Reduction Act is lowering drug prices for people on Medicare. The department plans to continue negotiating for lower prices for 15 additional important drugs for seniors, building on its record of successful negotiations."

On Friday, nonprofit AARP and other patient advocacy groups commended the announcement.

"Medicare drug price negotiation has shown that it will lower the prices of important products, resulting in billions of dollars in savings for Medicare and its beneficiaries, according to AARP."

How much Medicare spent on the drugs

According to a CMS fact sheet released on Friday, Medicare Part D spent the most on Ozempic, Rybelsus, and Wegovy, totaling $14.43 billion. This was used by nearly 2.3 million enrollees during the specified time period.

Despite only 35,000 enrollees using Xtandi, Medicare Part D spent roughly $3.16 billion on the medication. In contrast, Trelegy Ellipta, which was used by 1.3 million enrollees, cost Medicare Part D approximately $5.14 billion.

The cost of Pomalyst was $2.07 billion, but only 14,000 patients used it. All other drugs in the program cost less than $2 billion.

According to the fact sheet, Medicare Part D spent the least on Otezla, with 31,000 enrollees using that medication, at a total of $995 million.

What's next in the Medicare price talks?

Drugmakers have until February 28th to decide whether to participate in the program. If they decline to negotiate, they must either pay an excise tax of up to 95% of their medication's U.S. sales or remove all of their products from the Medicare and Medicaid markets.

Medicare will engage in a lengthy negotiation process with those who participate, involving months of back-and-forth price offers. The federal program determines its initial offer for each medication based on sales volume data, the level of federal financial support for the drug's development, and data on pending or approved patent applications and exclusivities, among other information.

Starting in 2029, Medicare can negotiate prices for 20 drugs annually.

Medicare Part D drugs will be the only ones selected for negotiations in the first two rounds, while more specialized medications covered by Medicare Part B, typically administered by doctors, will be added in 2028.

Medicare will provide more chances for drugmakers to discuss prices with them, as per the final guidance released last year for the second round of negotiations. The initial price offers for 15 drugs must be presented by June 1, after which the first optional negotiation meetings will occur.