© Reuters. FILE PHOTO: U.S. President Joe Biden speaks about protecting Social Security, Medicare, and lowering prescription drug costs, during a visit to OB Johnson Park and Community Center, in Hallandale Beach, Florida, U.S. November 1, 2022. REUTERS/Kevin Lamarq
By Patrick Wingrove
(Reuters) -The Biden administration on Tuesday released its list of 10 prescription medicines that will be subject to the first-ever price negotiations by the U.S. Medicare health program that covers 66 million people, with big-selling blood thinner Eliquis from Bristol Myers (NYSE:) Squibb and Pfizer (NYSE:) among them.
President Joe Biden’s signature Inflation Reduction Act (IRA), signed into law last year, allows the Medicare health program for Americans aged 65 and over to negotiate prices for some of its most costly drugs.
Medicines on the list include Merck & Co’s diabetes drug Januvia, Eliquis rival Xarelto from Johnson & Johnson (NYSE:), and AbbVie (NYSE:)’s leukemia treatment Imbruvica.
Other drugs on the list include Amgen (NASDAQ:)’s rheumatoid arthritis drug Enbrel, Boehringer Ingelheim and Eli Lilly (NYSE:)’s diabetes drug Jardiance, J&J’s arthritis and Crohn’s disease Stelara and insulin from Novo Nordisk (NYSE:).
This kicks off the negotiation process for the 10 drugs whose new prices would go into effect in 2026. The program aims to save $25 billion per year on drug prices by 2031.
Drugmakers including Bristol Myers, Johnson & Johnson, Merck, Britain’s AstraZeneca (NASDAQ:), Japan’s Astellas Pharma and Germany-based Boehringer Ingelheim, as well as business groups have sued the U.S. Department of Health and Human Services (HHS), which oversees the Medicare agency, in an effort to derail the price-setting process.
Americans pay more for prescription drugs than patients in all other developed nations. Under the program, the minimum cut from a drug’s list price will be 25%, but the government could barter for much bigger discounts.
The 10 initial drugs will have met certain criteria set out by the Medicare agency. They must be sold in pharmacies, not have substantial generic competition and have been on the market for at least nine years – 13 for more complex biotech drugs.
Once the list is out, drugmakers will have until Oct. 1 to sign agreements to participate in the talks and until Oct. 2 to submit data on their medicines, including research and development and production costs, information on patent applications and revenue and sales volume.