Why it matters: The price offers provide the impetus for negotiations.
The drugs selected for negotiations are taken by millions of older Americans to treat diseases such as diabetes, cancer and heart failure. The administration identified them in August and began a lengthy process that would result in an agreed price that would take effect in 2026 if the negotiation program survives legal challenges.
The first round of price offers is an important step in the negotiation process. Each drugmaker has until early March to accept the offer or propose a counteroffer to the government. A series of negotiating sessions could follow, with the process expected to be completed by August.
Health policy experts said the announcement of the first round of offers was a starting point, giving the Biden administration a chance to take an aggressive stance and test drugmakers’ willingness to comply.
The proposals help “set the tone for the rest of this back-and-forth,” said Andrew W. Mulcahy, a health economist at the RAND Corporation who has advised the Biden administration on its implementation of drug price negotiations.
Drugs in price discussions include Eliquis, Jardiance, Xarelto, Januvia, Farxiga, Entresto, Enbrel, Imbruvica and Stelara. The insulin products Fiasp and NovoLog were also selected. The government did not publicly disclose how much it was offering for the drugs, which are covered under the Medicare prescription drug program that patients take at home, known as Medicare Part D.
What happens next: The courts still have to weigh in.
The price negotiation program was created by the Inflation Reduction Act, the climate, tax and health care package that President Biden signed into law in 2022. Additional drugs will be selected for price negotiations in the coming years. The program is expected to save the federal government nearly $100 billion over a decade.
The price negotiation program is a central part of the White…