Top Diabetes Drugs Among Medicare Price Negotiations
Jardiance, Farxiga, Januvia, and rapid-acting insulins Fiasp and NovoLog will be eligible for price negotiations starting this fall. Reduced prices are scheduled to go into effect in 2026.
The U.S. Centers for Medicare and Medicaid Services (CMS) announced the first round of drugs eligible for price negotiations. Among them are a handful of drugs approved for diabetes, heart failure, and kidney disease.
This is the latest victory in medication access thanks to the Inflation Reduction Act. The Inflation Reduction Act aims to reduce healthcare costs through insulin price caps, caps on costs for other drugs, penalties for drug makers that raise prices, and benefits for low-income people.
Which diabetes drugs are eligible for price negotiations?
The list of 10 drugs includes the following diabetes medications:
|Diabetes and heart failure
|Diabetes, heart failure, and chronic kidney disease
The list also includes three agents for broader cardiovascular health:
Entresto, approved for heart failure.
Xarelto, a blood thinner used to prevent and treat blood clots. It also reduces the risk of clots for people with coronary or peripheral artery disease (PAD).
Eliquis, a blood thinner approved for the prevention and treatment of blood clots.
How were these drugs chosen for negotiation?
The U.S. Health Secretary selected 10 drugs from a list of medications with the highest total Medicare Part D spending.
Medicare Part D refers to prescription drug coverage. It includes several diabetes medications and insulins – including Lantus, Jardiance, NovoLog, and Trulicity – that are also on the list of most expensive drugs overall.
The 10 medicines chosen were used by more than eight million people covered by Medicare Part D in the past year, according to CMS, which amounted to $50.5 billion in total prescription drug costs.
When will the negotiated prices go into effect?
Negotiations will take place in 2023 and 2024 with participating drug makers. The negotiated prices are scheduled to go into effect in 2026.
Medicare will negotiate 15 more Part D drugs in 2027, 15 Part D and Part B drugs for 2028, and 20 Part D and Part B drugs for 2029 and on.
How large of an impact will negotiated prices have?
President Joe Biden said that once the negotiated prices take effect, up to nine million older adults may see lower drug prices. This is especially important because seniors currently pay up to $6,500 in out-of-pocket costs each year for these medications.
In 2022, Medicare beneficiaries paid $3.4 billion in total out-of-pocket costs for just these 10 drugs. Negotiated prices will range from 25-60 percent off a drug’s list price. Discounts may vary based on how long a medication has been on the market.
What does this announcement mean for people with diabetes?
When negotiated prices go into effect, people with diabetes on Medicare will be able to access their medications at reduced prices. This is likely to ensure more consistent use of drug treatments and lead to better glycemic control.
Jardiance and Farxiga also provide cardiovascular protection, so greater access to these drugs can ensure improved heart health.
"Making diabetes care more affordable is a top priority for the American Diabetes Association. We commend CMS for taking action to bring down costs of life-saving drugs, including those for Medicare beneficiaries living with prediabetes and diabetes,” said Lisa Murdock, chief advocacy officer at the American Diabetes Association (ADA).
How might price negotiations affect diabetes research and innovation?
One unintended effect of these price reductions is that they may potentially slow down pharmaceutical research. When lower prices go into effect, drug companies will likely make less money on these drugs. If drug companies bring in less money overall, they may need to make budget cuts to certain parts of their business, such as clinical trials.
Since research is a key part of improving diabetes care, it is important to continue to advocate for investment into clinical trials.
“Equally as important is the ongoing support of innovative research and development to find a cure for diabetes. We look forward to continuing to work with CMS and others to have a positive impact in the diabetes community we serve,” said Murdock.
Learn more about access to diabetes medications and insulin here: