CMS moves to lock in drug price negotiation

Clinical takeaway: The first negotiated Medicare prices on 10 widely used drugs, including Eliquis, Xarelto, Jardiance, and Januvia, took effect in January; 15 more, including Ozempic, Rybelsus, and Wegovy, are slated to have negotiated prices in January 2027.

The Medicare Drug Price Negotiation Program has run on annual guidance since it launched, leaving its longer-term future uncertain. A proposed CMS rule would codify it into permanent regulation, signaling the program is here to stay and setting the terms for future negotiation cycles.

The program is already reshaping what Medicare pays for high-cost drugs. CMS says it has negotiated prices for 25 high-expenditure drugs across its first two cycles, with the first 10 prices effective this year. A third round of 15 drug prices takes effect in 2028, among them Biktarvy, Trulicity, and Cosentyx. The proposed rule would carry that forward, selecting up to 20 more Part B and Part D drugs for a fourth cycle beginning in 2029.

CMS estimates the first round of negotiated Medicare drug prices would save about $6 billion across the 10 selected drugs in a single year. The second round would save about $12 billion across the 15 selected drugs, or $8.5 billion after accounting for other required discounts. Per-drug prices were cut by anywhere from 38% to 79% in the first round and 38% to 85% in the second. Third-round savings are not yet estimated, but the selected drugs account for roughly $27 billion in annual Medicare spending.

Beyond making the framework permanent, the rule adds several specific policies. It would implement a temporary price floor barring CMS from countering below a set minimum for certain small-biotech drugs in 2029 and 2030, a concession aimed at protecting smaller manufacturers. It would also close a path by which new formulations could sidestep selection. Two Part D provisions would require plans to include selected drugs on formularies and cap negotiated prices at the maximum fair price plus dispensing fees.

The proposed rule is available for public comment before CMS issues a final version. If finalized, it would govern the fourth negotiation cycle and beyond, replacing the year-by-year guidance the program has used previously.

"The program is already delivering real savings," said Chris Klomp, director of Medicare and chief counselor of the U.S. Department of Health and Human Services. "This rule builds on that foundation by establishing clear, consistent rules of the road—giving patients, plans, pharmacies, and drug manufacturers the certainty they need as we continue to drive down costs."

Source: Centers for Medicare & Medicaid Services. 2026 Jun 12. CMS proposed rule locks in lower prices and fosters innovation for the Medicare Drug Price Negotiation Program