By Daisy Brown, Legislative Liaison, TSCL
In January, the Centers for Medicare and Medicaid Services (CMS) announced the next 15 drugs whose prices it will negotiate directly with pharmaceutical companies, using powers granted by the 2022 Inflation Reduction Act (IRA). Weight-loss drugs Ozempic, Rybelsus, and Wegovy made the list, potentially spelling a turning point for seniors’ access to the popular-but-pricey medicines. (See a full list of drugs up for negotiation in this article’s sidebar.)
Negotiations on the drugs’ prices will occur during 2025, and the resulting prices will come into effect in 2027. According to CMS, the 15 drugs up for negotiation this year accounted for about 14 percent of drug costs covered under Medicare Part D between November 2023 and October 2024. About 5.3 million people covered by Part D used them during that period.
Based on the first round of negotiations, which occurred in 2024 and set prices for 10 drugs that will go into effect in 2026, it’s likely that this second round will meaningfully reduce costs for seniors. CMS estimates that if the negotiated prices had taken effect in 2023, they would have saved the agency approximately $6 billion. When they take effect in 2026, CMS expects people with Medicare Part D to save $1.5 billion in out-of-pocket costs.
If the second round of negotiations can reduce prices for weight loss drugs like Ozempic, the impact could be substantial. Today, Medicare only covers the drugs for health issues not related to weight loss, such as heart disease and diabetes, but with lower prices, it would be easy to see the agency making them more broadly available because of the potential for effective weight management to reduce the risk factors for other diseases.
However, Medicare will need to overcome resistance from drug makers to see the process through. Novo Nordisk, the maker of Ozempic and Wegovy, has already filed a lawsuit against the federal government for including its insulin medications NovoLog and Fiasp in the first round of negotiations and strongly opposes the program. “We believe the IRA’s pricing scheme will limit patient access and negatively affect overall patient care,” the company said in a statement when it announced its lawsuit. “Novo Nordisk is challenging this law to protect patients and ensure our ability to continue developing and providing transformative medicines to treat and cure chronic diseases now and in the future.”
One other potential headwind to this year’s price negotiations is the new presidential administration. Since the IRA was passed by a Democratic administration and Congress, it’s likely that the law will come under intense scrutiny while Republicans control both the White House and the Capitol. According to Bloomberg, drugmaker Eli Lilly & Co. has already called for the Trump administration to pause the price negotiation process while it updates the law or makes improvements to the price negotiation process.
At TSCL, we strongly support the IRA’s provision that empowers Medicare Part D to negotiate drug prices. Whatever happens with the rest of the act, we’ll be fighting hard to ensure this component remains intact—and that you see another round of reduced Part D drug prices in 2027.
Curious to see if one of your prescriptions is up for Medicare Part D price negotiations? Here is the full list of drugs up for price negotiations in 2025:
- Ozempic, Rybelsus, and Wegovy
- Trelegy Ellipta
- Xtandi
- Pomalyst
- Ibrance
- Ofev
- Linzess
- Calquence
- Austedo and Austedo XR
- Breo Ellipta
- Tradjenta
- Xifaxan
- Vraylar
- Janumet and Janumet XR
- Otezla
