The U.S. Department of Health and Human Services unveiled 15 additional drugs chosen for the Medicare Drug Price Negotiation Program last week. Many healthcare leaders are applauding the list of selected drugs, while drug manufacturers are coming out against it.
Under the program, which was created through the Inflation Reduction Act, the federal government is able to negotiate the price of selected drugs with participating drug companies. The first 10 drugs were announced in August 2023 and the negotiated prices will go into effect in 2026. Negotiations for the next 15 drugs will take place this year and the negotiated prices will go into effect in 2027.
The additional drugs selected for the program are:
- Ozempic; Rybelsus; Wegovy
- Trelegy Ellipta
- Xtandi
- Pomalyst
- Ibrance
- Ofev
- Linzess
- Calquence
- Austedo; Austedo XR
- Breo Ellipta
- Tradjenta
- Xifaxan
- Vraylar
- Janumet; Janumet XR
- Otezla
These drugs accounted for about $41 billion in total gross covered prescription drug costs under Medicare Part D between November 2023 and October 2024, according to HHS. In addition, during the same time period, about 5.3 million people with Medicare Part D coverage used these drugs for conditions like cancer, type 2 diabetes and asthma.
While manufacturers oppose HHS’ announcement, AARP, a nonprofit for Americans aged 50 and older, applauded the list of additional drugs chosen for the negotiation program.
“Price negotiations for Ozempic and Wegovy have the potential to completely change patient access to comprehensive obesity care,” says Brooke Boyarsky Pratt, founder and CEO of knownwell, a company offers metabolic health services, primary care, nutrition counseling and health coaching.
Takeaway
While drug companies will naturally rally against the HHS program, we think this will have a huge impact for older and younger adults. Particularly for those taking Ozempic, Rybelsus and Wegovy, the GLP-1 weight loss drugs that have taken the world by storm. Here are the average costs of these 3 drugs for people without insurance:
Wegovy – $1,349 per month or $16,188 per year
Ozempic – $969 per month or $11,628 per year
Rybelsus – $1,200 per month or $14,400 per year
What’s important to note is insurance companies will only cover the drug if you have type 2 diabetes. While type 2 diabetes in an important health concern that we are glad to see insurance companies stepping up to the plate to authorize the use of these drugs for the condition, it’s common knowledge that the majority of consumers use these drugs to lose weight. In fact, recent studies found a twofold increase in GLP-1 drug users without diabetes between 2011 and 2023.
If given enough time for the patents to expire in 2032, the prices of these drugs would naturally decline. But that’s 5 years after the new Medicare pricing will take effect. That’s 5 years of chronic obesity, heart issues and cognitive issues overweight and obese people would have to deal without the new Medicare pricing.
Source:
Who uses GLP-1 drugs, and for what? Is it worsening diabetes drug shortages?
