Medicare to Implement Price Reductions for These 10 Drugs

The federal government, under President Biden’s administration, has identified the diabetes treatment medication Jardiance and the blood thinner Eliquis as two drugs to negotiate prices for, in an effort to reduce Medicare costs. This marks the first time the government will directly negotiate drug prices with manufacturers. While this move is expected to benefit patients by cutting costs, it has faced opposition from the drugmakers and Republican lawmakers. Other drugs on the negotiation list include Enbrel, an autoimmune disease treatment from Amgen, and Entresto, a heart failure treatment from Novartis.

Medicare’s spending on Eliquis in 2020 amounted to approximately $10 billion, according to AARP research. Eliquis is used for treating blood clots in the legs and lungs and reducing the risk of stroke in individuals with atrial fibrillation. President Biden plans to address the issue of healthcare costs in a speech at the White House following this announcement, as it has been a central focus of his reelection campaign. Over 52 million people, including those aged 65 and older and those with disabilities or severe illnesses, receive prescription drug coverage through Medicare’s Part D program. Research by the Commonwealth Fund revealed that around 9% of Medicare beneficiaries aged 65 and older reported not being able to afford a prescription or skipping medication doses due to cost constraints in 2021.

The Centers for Medicare and Medicaid Services (CMS) aims to negotiate the lowest maximum fair price for the drugs listed. This negotiation could benefit patients who have insurance coverage but still face high out-of-pocket expenses such as deductibles when obtaining prescriptions. Currently, pharmacy benefit managers negotiate rebates with drug manufacturers for Medicare prescription plans. While these rebates may help reduce premiums, they often do not affect the cost a patient pays at the pharmacy counter. The goal of the new drug price negotiations is to make medications more affordable while still allowing for pharmaceutical companies to make profits. Drug manufacturers that refuse to participate in the negotiation process will face substantial taxation. (Read more Medicare stories.)