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The Biden administration on Tuesday (August 29) unveiled a list of ten prescription medications that will undergo groundbreaking price negotiations within the US Medicare program. 

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The US Medicare program covers 66 million individuals. Notably, Eliquis, a widely used blood thinner from Bristol Myers Squibb and Pfizer, is included in the list of prescription medications that will undergo the price negotiations.

US medication price reforms: Why negotiations?

This is because the Inflation Reduction Act, deemed a significant achievement for President Joe Biden, permits the Medicare program for individuals aged 65 and above to engage in price negotiations for expensive drugs. 

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Biden in recent past has asserted the need to prevent Americans from overpaying for life-saving medications and boosting pharmaceutical companies' profits.

Upon implementation, the negotiated drug prices are expected to drop for around 9 million senior citizens, potentially reducing their current out-of-pocket expenses that can reach up to $6,497 annually.

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Inflation Reduction Act: Which all medications are included?

The list comprises various medicines, such as Januvia by Merck & Co, Xarelto by Johnson & Johnson, and Imbruvica by AbbVie, among others. 

This move initiates negotiations for these drugs, with their new prices set to take effect in 2026. The program aims to save $25 billion each year on drug costs by 2031.

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Some drug manufacturers, including Bristol Myers, Johnson & Johnson, Merck, AstraZeneca, and Boehringer Ingelheim, have contested the pricing process through legal action against the U.S. Department of Health and Human Services.

The selection of the initial ten drugs for negotiation is based on specific criteria outlined by Medicare. These drugs must be sold in pharmacies, lack significant generic competition, and have been available on the market for at least nine years, or 13 years for more complex biotech drugs.

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