The Centers for Medicare & Medicaid Services (CMS) has announced it will proceed with Medicare drug price negotiations under the current administration, emphasizing a commitment to greater transparency in the process. This second round of negotiations will include high-profile, expensive weight-loss drugs like Ozempic and Wegovy.
CMS stated that lowering drug prices remains a top priority. As this new cycle begins, the agency plans to incorporate lessons learned from the first round and seek stakeholder input on improving the negotiation program. This feedback will aim to balance achieving better value for beneficiaries and taxpayers while continuing to encourage pharmaceutical innovation. The program has faced criticism from some pharmaceutical companies, who argue that pharmacy benefit managers are a key driver of high drug prices.
Earlier in January, CMS revealed the 15 drugs targeted for this round of negotiations. The inclusion of Ozempic and Wegovy is notable due to their popularity and high cost. Wegovy’s list price is $1,349.02 per injection, and Ozempic’s is $997.58, making them unaffordable for many. While insurance coverage can lower costs, they remain prohibitively expensive for many individuals.
The 15 drugs on the list, up from 10 in the previous round, represent billions in taxpayer spending. Negotiations between Medicare and drugmakers typically span several months, with new prices taking effect in 2027.
These negotiations stem from the Inflation Reduction Act of 2022, which allows Medicare to negotiate drug prices directly with pharmaceutical companies for the first time. CMS noted that these 15 drugs were used by roughly 5.3 million Medicare Part D beneficiaries between November 2023 and October 2024, costing approximately $41 billion, or 14% of total gross covered prescription drug costs under Part D.
HHS Secretary Xavier Becerra highlighted the success of past negotiations and the commitment to securing lower prices for these 15 key drugs. He emphasized the Inflation Reduction Act’s role in lowering prescription costs for Medicare beneficiaries and the ongoing dedication to negotiating in their best interests.
The second round of drugs selected for negotiation includes:
Ozempic; Rybelsus; Wegovy
Trelegy Ellipta
Xtandi
Pomalyst
Ibrance
Ofev
Linzess
Calquence
Austedo; Austedo XR
Breo Ellipta
Tradjenta
Xifaxan
Vraylar
Janumet; Janumet XR
Otezla
The high demand for GLP-1 drugs like Ozempic and Wegovy for diabetes and weight loss could lead to increased costs for taxpayers if covered by Medicare. Lowering their prices would improve accessibility. Successful negotiations would bring the total number of Medicare-negotiated drugs to 25. CMS plans to identify up to 15 more drugs annually for the coming years, as outlined in the Inflation Reduction Act.
Ozempic and Wegovy belong to the GLP-1 agonist class, originally developed for diabetes treatment. They have proven effective for weight loss by mimicking a gut hormone that reduces hunger and delays stomach emptying. Rybelsus is another GLP-1 drug available as a daily pill with similar effects to Ozempic.