Second Cycle of Medicare Drug Price Negotiations Includes 4 Oncologic Agents

The CMS has selected 15 drugs covered under Medicare Part D for the second cycle of the Drug Price Negotiation Program, including enzalutamide, pomalidomide, palbociclib, and acalabrutinib.

The second cycle of the Drug Price Negotiation Program is underway, and the US Department of Health and Human Services (HHS) through the Centers for Medicare & Medicaid Services (CMS), has selected 15 more drugs covered under Medicare Part D for price negotiations.1 Among the 15 drugs are 4 agents used for the treatment of cancers: enzalutamide (Xtandi), pomalidomide (Pomalyst), palbociclib (Ibrance), and acalabrutinib (Calquence).

In this second cycle, in accordance with the Inflation Reduction Act (IRA) that was signed in August 2022, the negotiations with participating drug companies for the 15 selected agents will occur in 2025.1,2 The negotiation period ends November 1, 2025, and any negotiated prices will become effective in 2027.2 Following the release of draft guidance for the second cycle of Medicare Drug Price Negotiations in July 2024, Jeff Patton, MD, and Debra Patt, MD, PhD, MBA, FASCO, detailed consequences resulting from lesser-discussed elements of the guidance with OncLive®.Per the final guidance for the second cycle, drug companies with a selected therapy will have until February 28, 2025, to decide if they will participate in negotiations.1,2

The drugs under negotiation in this second cycle are:1

  • Semaglutide (Ozempic; Rybelsus; Wegovy)
  • Fluticasone furoate, umeclidinium and vilanterol (Trelegy Ellipta)
  • Enzalutamide
  • Pomalidomide
  • Palbociclib
  • Nintedanib (Ofev)
  • Linaclotide (Linzess)
  • Acalabrutinib
  • Deutetrabenazine (Austedo; Austedo XR)
  • Fluticasone furoate, vilanterol (Breo Ellipta)
  • Linagliptin (Tradjenta)
  • Rifaximin (Xifaxan)
  • Cariprazine (Vraylar)
  • Sitagliptin, metformin (Janumet; Janumet XR)
  • Apremilast (Otezla)

These 15 selected drugs accounted for approximately $41 billion, roughly 14%, in total gross covered prescription drug costs under Medicare Part D between November 2023 and October 2024; approximately 5.3 million people with Medicare Part D coverage used the selected drugs during this time. Notably, when combined with the 10 drugs that were chosen in the first cycle of negotiations, this group of drugs accounted for more than a third of total gross covered prescription drug costs under Medicare Part D over the same period. The BTK inhibitor ibrutinib (Imbruvica) was among the 10 drugs selected for the first round of negotiations; new prices negotiated for patients enrolled in Medicare Part D from the first round will go into effect on January 1, 2026.1,3

The CMS also noted that Medicare negotiated and reached agreements on new, lower prices with drug manufacturers for all 10 drugs that were included in the first cycle of negotiations.1 The new prices are anywhere from 38% to 79% discounts off the list prices, and it is anticipated that aggregated out-of-pocket cost savings will be approximately $1.5 billion for those with Medicare prescription drug coverage in 2026.

“Last year we proved that negotiating for lower drug prices works. Now we plan to build on that record by negotiating for lower prices for 15 additional important drugs for seniors,” Xavier Becerra, HHS Secretary, said in a news release. “Today’s announcement is pivotal–the IRA is lowering prices for people on Medicare. HHS will continue negotiating in the best interest of people with Medicare to have access to innovative, life-saving treatments at lower costs.”

Per the IRA, in the third cycle of negotiation—which will include drugs covered under Part B and Part D of Medicare—CMS will select up to 15 additional drugs. Each cycle thereafter will allow for up to 20 more drugs.

Drugs have been selected for negotiation thus far based on total gross covered prescription drug costs under Medicare Part D as well as other criteria required by law.2 As a result of the IRA, this is the first time Medicare has been allowed to directly negotiate prices of certain high expenditure, single source drugs without generic or biosimilar competition.

References

  1. HHS announces 15 additional drugs selected for Medicare drug price negotiations in continued effort to lower prescription drug costs for seniors. News release. CMS. January 17, 2024. Accessed January 20, 2025. https://www.cms.gov/newsroom/press-releases/hhs-announces-15-additional-drugs-selected-medicare-drug-price-negotiations-continued-effort-lower
  2. Medicare Drug Price Negotiation Program: selected drugs for initial price applicability year 2027. January 2025. Accessed January 20, 2025. https://www.cms.gov/files/document/factsheet-medicare-negotiation-selected-drug-list-ipay-2027.pdf
  3. HHS selects the first drugs for Medicare drug price negotiation. August 29, 2023. US Department of Health and Human Services. Accessed January 20, 2025. https://public3.pagefreezer.com/browse/HHS.gov/02-01-2024T03:56/https://www.hhs.gov/about/news/2023/08/29/hhs-selects-the-first-drugs-for-medicare-drug-price-negotiation.html