Medicare price negotiations 'will continue under Trump'
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President Trump will continue to pursue the policy of Medicare pricing negotiation introduced by former President Biden's Inflation Reduction Act (IRA), but will look at refining the programme.
A statement from the Centers for Medicare and Medicaid Services (CMS) said that, as the second cycle of negotiations starts under the Trump administration, it is "committed to incorporating lessons learned to date from the programme and to considering opportunities to bring greater transparency" to the process.
Pricing negotiations have been a major source of antagonism between the pharma industry and the federal government – which has spilled over into the courts – with companies claiming that the process amounts to little more than mandated price-setting.
The second cycle, announced earlier this month, has identified 15 new medicines that will be subject to negotiations, including Novo Nordisk's big-selling GLP-1 agonist drugs for obesity and diabetes. The price reductions would be due to come into effect from the start of 2027, a year after those for the first block of 10 medicines.
"Lowering the cost of prescription drugs for Americans is a top priority of President Trump and his administration," said the CMS in its statement.
Trump is planning to issue an executive order supporting drug price negotiations under the IRA, according to HHS Secretary nominee Robert F Kennedy Jr, who discussed the new administration's apparent plans during his first confirmation hearing yesterday. The President has previously threatened to revoke the legislation.
"My understanding is that the White House issued an executive order, I believe today, supporting the drug negotiations under the IRA," said Kennedy, in response to a question about the high cost of drugs from Democrat Senator Catherine Cortez Masto. "President Trump was very aggressive during his first term about negotiating […] drug prices," he added.
At the moment, no executive order has been published to that effect, and Kennedy did not give any further details about ways to improve the negotiation process. One measure pushed for by the industry would be to close the so-called 'pill penalty', a shorter window time for small-molecule drugs compared to biologics before they can become eligible for negotiations.
According to the HHS under Biden, the latest crop of 15 drugs were used by 5.3 million Medicare Part D recipients between November 2023 and October 2024 and cost the government $41 billion during that time.