The Biden Administration is gearing up for its next round of Medicare drug negotiations and this time popular, but expensive weight-loss drugs, including Ozempic and Wegovy, are on the list. The drugs, which have been effective in helping people lose weight, have faced a lot of backlash because of the high costs associated with them. The list price for Wegovy is $1,349.02 per injection while Ozempic’s list price is $997.58 per injection, which is cost prohibitive for many people who can benefit from these drugs. Insurance, if it's covered, can lower the cost, but it is still too pricey for many.
Medicare’s list includes drugs that cost taxpayers billions
The list includes 15 drugs the White House plans to negotiate, an increase from 10 in the last round. The negotiations between Medicare and the drugmakers tend to take place over several months and the new negotiated prices don’t kick in until 2027. It's also not clear how negotiations will be impacted by a new White House Administration, including incoming President Trump and the new Secretary of Health and Human Services.
The drug negotiations are part of the Inflation Reduction Act, put on the books in 2022. The Act allows Medicare, for the first time, to negotiate drug prices directly with the pharmaceutical companies. Incoming President Trump hasn’t said if he supports the government’s ability to directly negotiate with the drug companies.
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In a press release announcing the new drugs, CMS said that between November 2023 and October 2024, roughly 5.3 million people with Medicare Part D coverage used these drugs for several conditions ranging from cancer to type 2 diabetes. The drugs on the list accounted for about $41 billion in total gross covered prescription drug costs under Medicare Part D, or about 14%.
“Last year we proved that negotiating for lower drug prices works. Now we plan to build on that record by negotiating for lower prices for 15 additional important drugs for seniors,” said HHS Secretary Xavier Becerra. “Today’s announcement is pivotal – the Inflation Reduction Act is lowering prices for people on Medicare. HHS will continue negotiating in the best interest of people with Medicare to have access to innovative, life-saving treatments at lower costs.”
The drugs identified for negotiation in the second round include:
- Ozempic; Rybelsus; Wegovy
- Trelegy Ellipta
- Xtandi
- Pomalyst
- Ibrance
- Ofev
- Linzess
- Calquence
- Austedo; Austedo XR
- Breo Ellipta
- Tradjenta
- Xifaxan
- Vraylar
- Janumet; Janumet XR
- Otezla
Ozempic, Wegovy and other GPL-inhibitors are in high demand in the U.S. Due to that demand, Medicare covering them for diabetes and potentially other FDA-approved uses could increase the cost to taxpayers. Lowering the cost of the drugs would also make the medications accessible to more individuals. If negotiations are successful, Medicare will have lowered the prices on 25 drugs that are commonly used in America. CMS said in the coming years it will identify up to 15 more drugs, including drugs covered under Part B and Part D, to negotiate lower costs. It will also identify up to 20 more drugs for each cycle after that as per the plan laid out in the Inflation Reduction Act.
What are GLP-1 drugs?
Ozempic and Wegovy fall in the GLP-1 agonists class. They were originally prescribed to treat diabetes under the generic name semaglutide but have proven to be effective in reducing weight. Ozempic is FDA-approved for the treatment of diabetes and Wegovy is FDA-approved for treating obesity. The drugs mimic a gut hormone that decreases hunger and delays stomach emptying, so people eat less and don’t face severe cravings. They come in an injectable form, which patients administer once a week. Other GLP-1 drugs are available to make it easier, including Rybelsus, which is a daily pill that has the same effects as Ozempic.
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