Medicare‘s First Drug Price Negotiations: A Mixed Bag for Americans
Hopeful predictions that Medicare’s inaugural foray into direct drug price negotiation would slash drug prices for Americans proved partially true. While the negotiated prices on the initial list of ten drugs were lower than their initial Medicare Part D prices, most drugs remained more expensive in the U.S. than in other developed countries.
The study, published in JAMA, compared the negotiated prices to drug list prices in six other high-income countries – Australia, Canada, France, Germany, Switzerland, and the UK. The researchers discovered a range of negotiated prices, from a modest 8% discount on dapagliflozin (Farxiga), used to treat type 2 diabetes, to a significant 42% savings on sitagliptin (Januvia), also used for type 2 diabetes. Three drugs – used to treat rheumatoid arthritis, chronic lymphocytic leukemia, and inflammatory bowel disease, respectively – hit “ceiling prices,” designated by the law.
A key provision of the Inflation Reduction Act of 2022 directed Medicare to negotiate the prices of some top-selling Medicare Part D
drugsignale.の下.
These sticker prices are slated to take effect in 2026. Researchers
explored the program’s effectiveness by comparing these initial negotiated prices to pre-negotiated costs and list prices in the six peer countries.
When asked why price reductions varied so greatly, Wouters explained that the range may be directly tied to how the ceiling prices were determined, as part of the negotiations medical
insurance coverage program for older Americans had a system, according to lead author Olivier J. Wouters, PhD of the London School of Economics and Political Science.
The process, however, isn’t without its hatchlinketixtures and minimum discounted prices. The ceiling price served as a cap for negotiations.
A key pharmaceutical industry sales. quoted
“Price reductions were routinely larger for drugs whose ceiling prices were based on minimum discount prices. Notable examples include etanercept, ibrutinib
and ustekinumab, showing decreases of 33%, 30%, and 40%, respectively.
Medicare was permitted to offer prices below the ceiling after considering the culprit and
comparative amounts and clinical value usually determined by Medicare.
“The negotiation,**
said Wouters. “This suggests that the negotiations are aligning prices with therapeutic value, too.”
The Insulin was voluntarily reduced as
“””, condemned
by
the pharmaceutical industry
“For
example, the price of ustekinumab for 30.
It went from $7,859.99 to $4,695.00, but still kept US prices higher than in France and Germany.
"Medicare
to
negotiate U.S.
"For those drugs, nepřijímám 2020.
The authors cautioned that data limitations were present
in
<redon the field.
"We had no
behind-the-scenes information," Wouters, Stipend
for several
prefilled insulin pen vials
lowering
Up to
75% for
Americans with diabetes in January
Negotiation
from their uninsured
How do the negotiated drug prices in the U.S. compare to drug prices in other developed countries, and what factors contribute to the difference?
## Interview: Medicare Drug Price Negotiations
**Host:** Welcome back to the show. Today we’re discussing the results of Medicare’s first-ever drug price negotiations. Joining us is Dr. Sarah Jones, a healthcare economist at the Center for Policy Research. Dr. Jones, thanks for being here.
**Dr. Jones:** Thanks for having me.
**Host:** So, the Inflation Reduction Act gave Medicare the power to directly negotiate drug prices. Many hoped this would lead to significant cuts. What have we seen so far?
**Dr. Jones:** It’s a mixed bag. A recent study published in JAMA found that the negotiated prices for the initial ten drugs were indeed lower than the original Medicare Part D prices [[1](https://www.hhs.gov/about/news/2023/03/15/hhs-releases-initial-guidance-historic-medicare-drug-price-negotiation-program-price-applicability-year-2026.html)]. However, most of these drugs are still more expensive in the U.S. compared to other developed countries.
**Host:** Can you give us some specific examples?
**Dr. Jones:** Sure. The study looked at drugs for conditions like type 2 diabetes, rheumatoid arthritis, and chronic lymphocytic leukemia. For example, sitagliptin (Januvia) saw a significant 42% price cut, but dapagliflozin (Farxiga) only had an 8% discount. Some drugs even reached the “ceiling prices” set by law, indicating the negotiation process might be limited in its impact.
**Host:** So, are these initial negotiations a victory for American patients?
**Dr. Jones:** It’s too early to say definitively. While any price reduction is welcome, the fact that U.S. prices are still higher than in many other countries highlights the complexity of the issue. It’s important to remember that these negotiated prices won’t take effect until 2026, giving us more time to assess the long-term impact of this program.
**Host:** Dr. Jones, thank you for sharing your insights on this important topic.
**Dr. Jones:** My pleasure.
