CMS unveils first 10 drugs subject to price negotiations under the Inflation Reduction Act
Top-selling drugs by Bristol Myers Squibb, AstraZeneca and Novo Nordisk amongst those selected for the first cycle of price negotiations under the Inflation Reduction Act (IRA).
Earlier than expected, the US Department of Health and Human Services (HHS), through the Centers for Medicare & Medicaid Services (CMS), has today (August 29, 2023) announced the first 10 drugs selected for pricing negotiation mandated under enactment of the Inflation Reduction Act (IRA). The drugs were selected based on prescription drug costs recorded by CMS between June 1, 2022, and May 31, 2023. Used by over 8 million people in the US, they accounted for around $50.5 billion in total Part D prescription drug costs during this period.
Chiquita Brooks-LaSure CMS Administrator explained:
“Today marks a significant and historic moment for the Medicare program with the announcement of the first drugs selected for Medicare drug price negotiation. Our goal with these negotiations is to improve access to some of the costliest drugs for millions of people with Medicare while driving competition and innovation.”
In their accompanying statement, CMS also provided more information about the patient-focused listening sessions on the selected drugs that will occur later in 2023.
Next CMS will undertake pricing negotiations with participating manufacturers, taking place in 2023 and 2024. Any negotiated prices will become effective beginning in 2026. As noted in the press release issued by HHS, the negotiation process will consider the selected drug’s, ‘clinical benefit, the extent to which it fulfills an unmet medical need, and its impact on people who rely on Medicare, among other considerations, such as costs associated with research and development as well as production and distribution for selected drugs.’
The first 10 drugs subject to price negotiations under the Inflation Reduction Act are:
| Drug name | Brand name | Manufacturer | Total Medicare Part D spending (June 2022–May 2023) |
| Apixaban | Eliquis | Bristol Myers Squibb | $16.4 billion |
| Empagliflozin | Jardiance | Eli Lilly | $7.06 billion |
| Rivaroxaban | Xarelto | Johnson & Johnson | $6.03 billion |
| Sitagliptin | Januvia | Merck | $4.09 billion |
| Dapagliflozin | Farxiga | AstraZeneca | $3.29 billion |
| Sacubitril/valsartan | Entresto | Novartis | $2.88 billion |
| Etanercept | Enbrel | Amgen | $2.79 billion |
| Ibrutinib | Imbruvica | Johnson & Johnson | $2.66 billion |
| Ustekinumab | Stelara | Johnson & Johnson | $2.64 billion |
| Insulin aspart | Fiasp | Novo Nordisk | $2.58 billion |
Exactly which drugs would feature in this list has been subject to much speculation over the past few weeks, with many also voicing their concerns about the impact on healthcare innovation and R&D. Manufacturers themselves have hit back, with several lawsuits filed challenging the drug price negotiation provisions in the IRA. Today’s announcement follows two more lawsuits filed in recent days from AstraZeneca and Boehringer Ingelheim, adding to growing list of companies making a stand against the US government.
Related content
Be sure to catch up on all of our coverage of the IRA at our dedicated spotlight, including:
- Infographic: Inflation Reduction Act in numbers
- Patti Peeples speaks with Mark McClellan, ex-Administrator of CMS, discussing the IRA
- Impact of the Inflation Reduction Act on real-world evidence: an interview with Amanda Cole, Office of Health Economics
Like many others, we will be watching this closely as reactions to this list emerge. Sign up to The Evidence Base and follow us on LinkedIn to make sure you do not miss any of our coverage.
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