White House Expects IRA’s Negotiated Drug Prices to Save Medicare $6B in 2026 ###

Projected Savings:

The Biden administration expects the Inflation Reduction Act's (IRA) Medicare Drug Price Negotiation Program to save Medicare approximately $6 billion in 2026.

Out-of-Pocket Savings:

Seniors are anticipated to save around $1.5 billion in out-of-pocket expenses in 2026 due to the negotiated drug prices.

Historic Negotiations:

This marks the first time Medicare has directly negotiated drug prices with manufacturers, a power granted by the IRA passed in 2022.

Drug Selection:

The initial negotiations focused on 10 high-cost prescription drugs, including Eliquis, Jardiance, Xarelto, Imbruvica, Stelara, Januvia, Farxiga, Entresto, Enbrel, and Fiasp.

Discounts and Rebates:

The negotiated prices reflect discounts ranging from 38% to 79% compared to the 2023 list prices, though net prices (including rebates and discounts) are not publicly disclosed.

Future Negotiations:

More drugs will be negotiated annually, with 15 Part D drugs selected for 2027, and additional drugs for subsequent years.

Legal Challenges:

Pharmaceutical companies are contesting the negotiation process through lawsuits, arguing the IRA is unconstitutional, but have been unsuccessful so far.

Impact on Beneficiaries:

While some beneficiaries will see significant reductions in their medication costs, others may face higher out-of-pocket expenses due to changes in Part D plans.

Political and Public Response:

The Biden administration and Vice President Kamala Harris have highlighted the program's achievements as a significant step in reducing healthcare costs for seniors and taxpayers.