The United States’ Medicare health insurance program has negotiated lower prices for 15 prescription drugs from 2027, which could save 36% in annual spending.
These medications include weight loss drugs Ozempic and Wegovy, as well as treatments for asthma, leukemia, and prostate and breast cancer. The new prices are the amount the Medicare program will pay drugmakers, with costs for individual Medicare recipients depending on their coverage.
“The Maximum Fair Prices (MFPs) for these 15 drugs will become effective January 1, 2027, bringing the total number of negotiated drugs to 25 when combined with the 10 previously negotiated drugs with MFPs taking effect January 1, 2026,” wrote the Centers for Medicare & Medicaid Services (CMS).
“The MFPs offer substantial savings for both beneficiaries and the Medicare program.”
Medicare health insurance is available to Americans aged at least 65 and those with disabilities, with over 66 million people currently covered. Around 5.3 million people in the U.S. under Medicare Part D healthcare coverage used these 15 drugs during 2024, according to CMS.
These price reductions will save around US$8.5 billion in Medicare spending, the agency estimated, and will save individuals about $685 million in out-of-pocket costs once they take effect in 2027.
Ozempic and Wegovy’s prices will drop by 71% from their 2024 list price. Janumet and Tradjenta, which both treat type 2 diabetes, will see the largest price cuts by percentage, being reduced by 85% and 84%.
Cancer medications Xtandi, Calquence, and Ibrance will also have their prices slashed by at least $5,000 each. The price of Pomalyst, which treats sarcoma and myeloma, will be cut from $21,744 to $8,650.
The cuts will be implemented under the Medicare drug price negotiation program created in 2022. Price reductions for an initial 10 medications were confirmed last year.
Wegovy’s price will also be lowered under a separate deal the U.S. government struck with its maker Novo Nordisk this month in exchange for an exemption from pharmaceutical tariffs.
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