Medicare to negotiate prices with manufacturers of 10 major prescription drugs

Feb. 1 (UPI) -- Medicare on Thursday will send initial pricing offers to drug manufacturers on the first 10 medications selected for negotiation, aiming to lower costs for families.

The White House announced the negotiations to set lower prices for the 10 most expensive prescription drugs covered under Medicare, marking the first time the program will not accept the prices set by manufacturers as a result of the Medicare Drug Price Negotiation Program.

"Just one of these drugs alone can cost as much as $6,500 in out-of-pocket costs for seniors," as Big Pharma rakes in billions in record profits, President Joe Biden said in a statement.

The initiative launched last August in discussions between Medicare and the pharmaceutical giants, aims to lower prices on prescription medicines for conditions like diabetes, Crohn's disease, arthritis, heart disease, blood clots, and cancer.

The 10 drugs in the first round of pricing discussions are among the top 50 prescription medications that seniors fill the most at retail pharmacies under Medicare Part D.

In 2022, nine million seniors on Medicare spent upwards of $3.4 billion for the drugs, including Eliquis, Jardiance, Xarelto, Januvia, Farxiga, Entresto, Enbrel, Imbruvica, Stelara, and a family of insulin products to treat diabetes, including Fiasp and NovoLog.

The reconfigured prices will be announced in September, however the new drug costs won't go into effect until 2026.

From there, the government will select up to 15 more drugs covered under Part D for 2027, and up to 15 more drugs for 2028, including drugs covered under Part B and Part D. And the program will add up to 20 more drugs in each year after that, as required by the Inflation Reduction Act.

Before now, Medicare was forced to accept inflated prices that were set unilaterally by the pharmaceutical industry.

Meanwhile, the White House noted that nine lawsuits have been filed by the pharmaceutical industry to declare the price negotiations unconstitutional, while accusing House Republicans of planning to overturn the Inflation Reduction Act to derail the effort.

"President Biden won't stand for that," the White House said. "He is laser-focused on lowering costs, protecting Medicare and Social Security, and making sure his Inflation Reduction Act gives more seniors, people with disabilities, and families more breathing room."

Through the pricing negotiations, Biden was seeking to fulfill a campaign promise to make prescription medicines more affordable for millions of aging Americans.

Biden said the new pricing mandate, established in the 2022 Inflation Reduction Act, was "working to give seniors the best possible deal on their prescription drugs and lower health care costs."

The pandemic-era legislation contains a broad range of actions to mitigate high drug prices, including a plan that adds commercial health insurers to a requirement that forces drug companies to pay rebates to Medicare whenever medicine prices rise faster than inflation.

In his statement, Biden also took credit for reducing insulin costs to $35 for seniors and individuals with disabilities, and he said his policies have resulted in 15 million Americans saving $800 annually on health insurance costs.

Starting next year, out-of-pocket drug costs will be limited to $2,000 for seniors as the administration works to ensure that Americans no longer pay two to three times more for prescription drugs compared to other countries, Biden said.

"My administration won't stop fighting to lower health care costs for seniors and families," the president wrote. "We'll continue to protect these programs and deliver lower costs for seniors and hardworking families."