Biden Administration Announces Major Drug Price Cuts for Medicare: Discounts Up to 79%

On Thursday, the Biden administration announced that recent drug price negotiations will significantly reduce the costs of 10 of Medicare’s most expensive medications, with discounts ranging from 38% to 79% off their list prices. The U.S. Department of Health and Human Services (HHS) revealed that if these new prices had been in place last year, Medicare would have saved approximately $6 billion—about 22% of the total cost for these drugs.

The reduced prices will benefit drugs used to manage conditions such as diabetes, blood cancers, and heart failure. Among the medications affected are the blood thinners Xarelto and Eliquis, as well as diabetes treatments Jardiance and Januvia. By 2026, Medicare beneficiaries are expected to see $1.5 billion in savings on their personal out-of-pocket expenses.

The agreement marks a historic shift for Medicare, which for decades was prohibited from negotiating drug prices, unlike private insurers. “This is a groundbreaking development for the Medicare program, which serves over 67 million older and disabled Americans,” noted The Los Angeles Times.

President Joe Biden highlighted the significance of this achievement, stating, “For years, Americans faced the difficult choice between paying for medications or essential needs like food, while Big Pharma prevented Medicare from negotiating drug prices. We stood up for our seniors and won.”