Key takeaways:
The Medicare Drug Price Negotiation Program, established by the Inflation Reduction Act of 2022, has reduced the maximum fair price for its first round of high-cost medications — 10 to start — effective January 1, 2026.
Additional medications for negotiation have been announced. Those price drops will be effective in 2027 and 2028 for drugs covered by Medicare Part D prescription plans and Medicare Part B, which covers medications administered in a healthcare setting.
Medicare’s discounts may not make your prescriptions more affordable. Many people with Medicare Part D plans could find more relief from the $2,100 out-of-pocket limit for covered prescriptions in 2026.
The Inflation Reduction Act of 2022 (IRA) delivered financial relief to many Medicare enrollees in 2023 by capping out-of-pocket costs for insulin at $35 a month. Now the federal law is bringing more savings to consumers who take other medications.
The Medicare Drug Price Negotiation Program, part of the IRA, enables the Centers for Medicare & Medicaid Services (CMS) to negotiate lower prescription medication prices. The first 10 medications selected for negotiation include diabetes treatments and blood thinners that cost Medicare more than $50 billion in gross drug costs in 1 year and accounted for 20% of the program’s pharmacy medication costs, according to the U.S. Department of Health and Human Services (HHS). Gross drug cost includes what Medicare, the prescription plan, and the enrollee paid collectively for a medication.
The first 10 medications selected for the Medicare Drug Price Negotiation Program are:
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The lower prices for the initial 10 medications went into effect on January 1, 2026. All are covered by Medicare Part D. Dozens more medications will be chosen for negotiation through 2029. These will include drugs covered by Medicare Part B. Some of them are treatments given by a healthcare professional or in a medical setting, such as IV biologics in an infusion clinic.
But Medicare’s discounts may not significantly reduce costs for every consumer. People with Medicare Part D plans may find the most relief from the IRA’s out-of-pocket limit for prescriptions that became effective in 2025 at $2,000 and increased to $2,100 in 2026.
What is the Medicare Drug Price Negotiation Program?
The Medicare Drug Price Negotiation Program is a result of the IRA. This federal law aims to reduce healthcare costs in several ways. One way includes allowing Medicare — for the first time — to negotiate the prices of medications.
Some medications are excluded from price negotiation, including:
Certain orphan drugs for rare conditions
Low-spend Medicare drugs
Plasma-derived products
Small biotech drugs
The selected drugs may not have the highest prices, but they are large expenses for Medicare. The program is projected to save the government $98.5 billion over a decade and aims to make prescriptions more affordable for consumers.
Which medications are being negotiated by Medicare?
The first 10 medications selected for negotiation are covered by Medicare Part D. These drugs are older treatments that have been approved or licensed by the FDA for at least 7 years (or 11 years for biologics). They are single-source, high-cost medications with no generics or biosimilars.
The second round of medications, 15 in all, are set to have maximum fair prices effective on January 1, 2027. The third round includes medications scheduled to have maximum fair prices effective on January 1, 2028. Negotiations are expected to continue for future years.
First round
The initial 10 medications are listed with further details below.
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Drug name (manufacturer) | Commonly treated conditions | Total Part D gross covered prescription drug cost from June 2022 to May 2023 | Number of Medicare Part D enrollees who used the drug from June 2022 to May 2023 |
|---|---|---|---|
Eliquis (Bristol Myers Squibb) | Prevention and treatment of blood clots | $16.5 billion | 3,706,000 |
Jardiance (Boehringer Ingelheim/Eli Lilly) | $7.1 billion | 1,573,000 | |
Xarelto (Johnson & Johnson) | Prevention and treatment of blood clots, reduces risk of major cardiovascular events for people with coronary artery disease or peripheral artery disease | $6 billion | 1,337,000 |
Januvia (Merck) | Diabetes | $4.1 billion | 869,000 |
Farxiga (AstraZeneca) | Diabetes, heart failure, chronic kidney disease (CKD) | $3.3 billion | 799,000 |
Entresto (Novartis) | Heart failure | $2.9 billion | 587,000 |
Enbrel (Amgen) | $2.8 billion | 48,000 | |
Imbruvica (Johnson & Johnson/AbbVie) | Blood cancers | $2.7 billion | 20,000 |
Stelara (Johnson & Johnson) | Psoriasis, psoriatic arthritis, Crohn’s disease, ulcerative colitis | $2.6 billion | 22,000 |
Fiasp, Fiasp FlexTouch, Fiasp PenFill, NovoLog, NovoLog FlexPen, NovoLog PenFill (Novo Nordisk) | Diabetes | $2.6 billion | 777,000 |
Second round
There are 15 medications in the second set of negotiations. Their lower prices will be effective on January 1, 2027. CMS estimates that these drugs will save $685 million in 2027 for Part D enrollees:
Austedo and Austedo XR for chorea in Huntington’s disease; tardive dyskinesia
Breo Ellipta for asthma; chronic obstructive pulmonary disease (COPD)
Calquence for chronic lymphocytic leukemia/small lymphocytic lymphoma; mantle cell lymphoma
Ibrance for breast cancer
Janumet and Janumet XR for Type 2 diabetes
Linzess for chronic idiopathic constipation, irritable bowel syndrome (IBS) with constipation
Trelegy Ellipta for asthma, COPD
Ofev for idiopathic pulmonary fibrosis
Otezla and Otexla XR for oral ulcers in Behçet’s disease, plaque psoriasis; psoriatic psoriasis
Pomalyst for Kaposi sarcoma; multiple myeloma
Semaglutide (Ozempic, Rybelsus, Wegovy for Type 2 diabetes; Type 2 diabetes and cardiovascular disease; cardiovascular disease and obesity)
Tradjenta for Type 2 diabetes
Vraylar for bipolar I disorder; major depressive disorder; schizophrenia
Third round
In addition to renegotiation for Tradjenta, there are 15 medications in the third set of negotiations:
Anoro Ellipta for COPD
Botox and Botox Cosmetic for chronic migraine; overactive bladder; spasticity; other movement disorders
Cimzia for Crohn’s disease; plaque psoriasis; psoriatic arthritis; rheumatoid arthritis
Cosentyx for plaque psoriasis; psoriatic arthritis
Erleada for prostate cancer
Entyvio for Crohn’s disease; ulcerative colitis
Kisqali for breast cancer
Lenvima for thyroid cancer; endometrial cancer; liver cancer; kidney cancer
Orencia for psoriatic arthritis; rheumatoid arthritis
Rexulti for major depressive disorder; schizophrenia; agitation associated with dementia because of Alzheimer’s disease
Trulicity for Type 2 diabetes; Type 2 diabetes and cardiovascular disease or multiple; cardiovascular risk factors
Verzenio for breast cancer
Xeljanz and Xeljanz XR for psoriatic arthritis; rheumatoid arthritis; ulcerative colitis
How does Medicare drug negotiation work?
CMS reports that its goal during medication price negotiations is to promote transparency and engagements with drug manufacturers and the public.
Steps in the negotiation process include:
Drug companies with a selected medication and the public have an opportunity to submit information about their drugs to CMS.
Each drug company is invited to meet about its data submission.
Public engagement events allow Medicare enrollees, caregivers, consumer organizations, and other interested parties to offer input.
CMS sends an initial offer for a maximum fair price for each drug, and manufacturers accept the initial offer or make a counteroffer.
If a maximum fair price is not reached through the initial offer and counteroffer process, CMS will invite the manufacturers with unresolved negotiations to meetings.
How are drugs selected for negotiation?
Negotiation-eligible medications were chosen based on their gross drug cost to Medicare, which is tied to price and use by enrollees. These calculations arrived at a list of the Top 50 drugs that excluded small biotech drugs.
How do consumers benefit from Medicare negotiating drug prices?
With lower medication prices, consumer out-of-pocket costs are expected to decrease. Medication adherence, which includes filling prescriptions and not skipping doses, may also improve if patients are better able to afford their medications.
Are there any alternative analyses of the drug negotiation program?
Kenneth Thorpe, PhD, at the Rollins School of Public Health at Emory University in Atlanta said he objects to the approach of trying to lower the cost of medications through drug price negotiation.
“This was sold as ‘We’re going to really get the high price of drugs down.’ That’s not what this is. They’re not targeting high-priced drugs. They’re targeting high-used drugs to treat chronically ill patients,” Thorpe said. When he worked at HHS from 1993 to 1995, he coordinated financial estimates and program impacts for President Bill Clinton’s healthcare reform proposals.
“The $2,000 out-of-pocket cap [in 2025] is the key. It’s still too high, I think,” he told GoodRx. “I would have liked to have seen it lower, and I would have liked to have seen the legislation mimic what Medicare Advantage does — not just cap insulin but have caps or eliminate cost sharing for mood disorders, diabetes drugs, cholesterol medications. [These are] things that we know are really effective in reducing overall costs and keeping these patients healthy.”
Thorpe also said the advocates have “oversold” the benefits to consumers.
“They’re not really negotiations. It’s just going to be pure-old European price setting,” he said. “I’m not against saving Medicare money, but let’s be honest about what the program is. It’s a budget exercise to save Medicare money. … The primary tool that benefits patients is that out-of-pocket cap.”
Has there been pushback to price negotiation?
Yes. Several companies whose medications have been chosen for negotiation have sued. The legal battles started even before the first-round list was released. New lawsuits continue to be filed, including one in February 2026 by AbbVie Pharmaceuticals after its drug, Botox, was named to the 2028 list.
How can I save on medications?
GoodRx can help you find the lowest price on your prescription at a pharmacy near you. It’s fast, free, and easy to use. You can save on prescriptions even if you have Medicare Part D coverage. That’s because your formulary may not have the medications you need, or your out-of-pocket costs, such as your copay, could be unaffordable.
Try GoodRx instead with these easy steps:
Download the GoodRx app or visit goodrx.com.
Enter your medication name and details to compare prices.
Find the lowest price, and get your coupon.
Show your pharmacist your GoodRx coupon.
It’s important to note that GoodRx is not insurance and cannot be combined with Medicare, Medicaid, or private health insurance coverage.
Frequently asked questions
Eliquis, the blood thinner that helps prevent blood clots, is the most costly Part D medication for Medicare and was taken by nearly 4 million Medicare enrollees in 2023.
Despite multiple contradictory reports, Ozempic will cost less than $300 a month for Medicare enrollees who have the conditions for the medication to be covered. A CMS fact sheet from November 2025 places the negotiated price at $274. A Trump Administration press release, also from November 2025, reported the price at $245 with a $50 monthly copay by Medicare enrollees.
The $2,000 cap on Medicare Part D out-of-pocket costs was effective in 2025 and was bumped to $2,100 for 2026. Spending about $2,000 out of pocket before your Medicare prescription plan pays 100% of the costs of covered prescriptions was a benefit redesign that brought relief to scores of Medicare enrollees in 2025. Previously, the limit was much higher — $8,000 in 2024 — to reach what is known as the Part D catastrophic coverage phase.
Eliquis, the blood thinner that helps prevent blood clots, is the most costly Part D medication for Medicare and was taken by nearly 4 million Medicare enrollees in 2023.
Despite multiple contradictory reports, Ozempic will cost less than $300 a month for Medicare enrollees who have the conditions for the medication to be covered. A CMS fact sheet from November 2025 places the negotiated price at $274. A Trump Administration press release, also from November 2025, reported the price at $245 with a $50 monthly copay by Medicare enrollees.
The $2,000 cap on Medicare Part D out-of-pocket costs was effective in 2025 and was bumped to $2,100 for 2026. Spending about $2,000 out of pocket before your Medicare prescription plan pays 100% of the costs of covered prescriptions was a benefit redesign that brought relief to scores of Medicare enrollees in 2025. Previously, the limit was much higher — $8,000 in 2024 — to reach what is known as the Part D catastrophic coverage phase.
The bottom line
The Medicare Drug Price Negotiation Program is a new program to reduce what the federal government pays for certain medications. Prescriptions are also expected to become more affordable for Medicare enrollees. This is part of the Inflation Reduction Act of 2022. The first 10 medications in the program had price drops effective on January 1, 2026, and all are covered under Medicare Part D prescription plans. These drugs treat diabetes, heart failure, and other chronic conditions. A second round of 15 medications are expected to have lower prices in 2027, and a third round of 15 more drugs are set for reduced costs in 2028. The program is expected to continue afterward.
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References
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CMS.gov. (2026). Selected drugs and negotiated prices. Centers for Medicare & Medicaid Services.
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GoodRx. (2024). What is chronic lymphocytic leukemia? YouTube.
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Medicare Drug Price Negotiation Program. (2023). Fact sheet: Medicare drug price negotiation program revised guidance. Centers for Medicare & Medicaid Services.
Medicare Drug Price Negotiation Program. (2023). Medicare drug price negotiation program: Selected drugs for initial price applicability year 2026. Centers for Medicare & Medicaid Services.
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Medicare Drug Price Negotiation Program. (2025). New lower drug prices under the Medicare drug price negotiation program. Centers for Medicare & Medicaid Services.
Medicare Drug Price Negotiation Program. (2026). Medicare drug price negotiation program: Selected drugs for initial price applicability year 2028. Centers for Medicare & Medicaid Services.
Medicare Drug Price Negotiation Program. (2026). Medicare drug price negotiation program: Top 50 negotiation-eligible drugs for initial price applicability year 2028. Centers for Medicare & Medicaid Services.
MedlinePlus. (2023). Blood clots.
O’Neill Institute for National and Global Health Law. (n.d.). Medicare drug price negotiation. Georgetown University Law Center.
Patients for Affordable Drugs. (2026). Statement: Patients for Affordable Drugs responds to AbbVie Pharmaceuticals lawsuit to stop Medicare negotiation.
Rao, P. (2025). Ranked: America’s most common drugs by Medicare spending. Visual Capitalist.
Rapfogel, N. (2023). 5 facts to know about Medicare drug price negotiation. Center for American Progress.
Rollins School of Public Health. (n.d.). Kenneth Thorpe. Emory University.
Stolberg, S. G., et al. (2023). U.S. announces first drugs picked for Medicare price negotiations. The New York Times.
The White House. (2025). Fact sheet: President Donald J. Trump announces major developments in bringing most-favored-nation pricing to American patients.
