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HHS Selects 15 More Drugs for Price Negotiation Under the IRA

Guilherme Ferrari Faviero, Esq., MS, MPH

HHS Selects 15 More Drugs for Price Negotiation Under the IRA
d3sign via Getty Images

On January 17, 2025, HHS announced a selection of 15 additional drugs for Medicare price negotiations under the Inflation Reduction Act (IRA). 

The IRA requires the HHS Secretary to directly negotiate the prices of certain high-expenditure, single-source drugs without generic or biosimilar competition. For each selected drug, the negotiation process aims to arrive at a maximum fair price (MFP) based on clinical benefits, therapeutic alternatives, and manufacturer-specific factors. 

Drugs included in the second round are Ozempic, Rybelsus, and Wegovy; Trelegy Ellipta; Xtandi; Pomalyst; Ibrance; Ofev; Linzess; Calquence; Austedo and Austedo XR; Breo Ellipta; Tradjenta; Xifaxan; Vraylar; Janumet and Janumet XR; and Otezla.  Together, the 15 drugs on the second negotiation list were used by 5.3 million people with Medicare Part D coverage from November 2023 to October 2024, resulting in approximately $41 billion in gross costs under Medicare Part D, or almost 14% of expenditures during that period.  

All pharmaceutical companies with a selected drug must decide by February 28, 2025, whether they will participate in the negotiation process, and CMS is expected to issue initial written offers for an MFP by June 1,2025.  Under the statute, negotiations are required to conclude by November 1, 2025, and any agreed prices would go into effect in 2027.  The first round of IRA negotiations resulted in reduced prices for all 10 drugs on the list, which will take effect on January 1, 2026.  

Since the first round of negotiations, drug makers have filed numerous lawsuits challenging the drug negotiation provisions, which remain ongoing. The Trump Administration’s position on these suits and the future of IRA drug price negotiations remains unclear.