The Biden administration announced Friday an expansion of its Medicare drug price negotiation program, targeting 15 widely used medications including the popular diabetes and weight-loss drugs Ozempic and Wegovy.
This second round of negotiations, authorized under the 2022 Inflation Reduction Act, aims to reduce costs for approximately 5.3 million Medicare Part D beneficiaries. The selected medications treat various conditions, including cancer, type 2 diabetes, and asthma. The negotiated prices would take effect in 2027.
Danish pharmaceutical company Novo Nordisk features prominently in the list, with three of its products selected: Ozempic, Wegovy and Rybelsus. Ozempic, which has gained celebrity attention for its weight-loss effects, currently carries a list price of nearly $1,000 for a monthly supply, while Wegovy costs approximately $1,350.
The pharmaceutical industry has strongly opposed the program, with lobbying group PhRMA arguing that the process amounts to coercion rather than negotiation. Industry representatives particularly criticized the inclusion of oral medications, citing a “pill penalty” provision that subjects these drugs to earlier price negotiations compared to other formulations.
The first round of negotiations, targeting 10 drugs, reportedly achieved price reductions ranging from 38% to 79%. Rep. Richard Neal of Massachusetts, the top-ranking Democrat on the House Ways and Means Committee, said the combined 25 drugs under negotiation represent one-third of Medicare Part D spending.
Critics, including pharmaceutical companies and Republican allies, contend that the program resembles socialist price controls and could stifle innovation in drug development. Novo Nordisk expressed concern about the selection criteria and potential impacts on patient access and medical innovation, though it committed to working with the administration to “deliver meaningful solutions for patients.”
The program’s supporters argue that it will reduce out-of-pocket costs for seniors and could influence broader drug pricing negotiations between pharmaceutical companies and private insurers. However, the actual impact on individual beneficiaries may vary depending on their specific coverage plans and cost-sharing requirements.
Read more: Ozempic, Wegovy top list of Biden’s price-negotiation drugs
This article is written with the assistance of generative artificial intelligence based solely on Washington Times original reporting and wire services. For more information, please read our AI policy or contact Ann Wog, Managing Editor for Digital, at awog@washingtontimes.com
The Washington Times AI Ethics Newsroom Committee can be reached at aispotlight@washingtontimes.com.