Medicare has negotiated discounts for 10 blockbuster drugs

For the first time, Medicare has negotiated prescription drug rebates that will dramatically reduce the cost of ten medications taken by millions of Americans.

The rebates are expected to save Medicare about $100 billion over 10 years, including an estimated $6 billion in 2026, the first year the rebates take effect, the U.S. Department of Health and Human Services (HHS) said in a statement. Patients would also save an estimated $1.5 billion in out-of-pocket costs in the first year of the rebates, the HHS said.

“Americans are paying too much for their prescription drugs,” HHS Secretary Xavier Becerra said in the statement. “That makes today's announcement historic. For the first time ever, Medicare has negotiated directly with pharmaceutical companies, and the American people are better off for it.”

The rebates will cover some of the most expensive and commonly prescribed drugs in the Medicare program, the HHS said. The new prices will apply to people with Medicare Part D prescription coverage starting Jan. 1, 2026.

The discounted medications include:

Discounts range from 38 to 79 percent

In the first year the rebates take effect, Medicare prices for the ten drugs will be 38 to 79 percent cheaper than in 2023, according to the HHS.

The negotiated monthly prices for each drug for 2026, together with the discount on 2023 prices, are as follows:

Januvia For diabetics; negotiated price $113 (79 percent discount)
NovoLog and Fiasp products For diabetics; negotiated price $119 (76 percent discount)
Farxiga For diabetes, heart failure and chronic kidney disease; negotiated price $178.50 (68 percent discount)
Enbrel For rheumatoid arthritis, psoriasis, psoriatic arthritis; negotiated price $2,355 (67 percent discount)
Jardiance For diabetes, heart failure and chronic kidney disease; negotiated price $197 (66 percent discount)
Stelara For psoriasis, psoriatic arthritis, Crohn's disease and ulcerative colitis; negotiated price $4,695 (66 percent discount)
Xarelto For blood clots, coronary artery disease, or peripheral artery disease; negotiated price $197 (62 percent discount)
Eliquis For blood clots; negotiated price $231 (56 percent discount)
Entry For heart failure, agreed price $295 (53 percent discount)
Imbruvica For blood cancer; negotiated price $9,319 (38 percent discount)

Together, these drugs accounted for about $56 billion of total Medicare spending, or about 20 percent of total gross spending for Medicare Part D in 2023, the HHS said.

From 2018 to 2022, total gross spending on these drugs under Part D more than doubled, from about $20 billion to about $46 billion. In 2022, patients enrolled in Medicare Part D spent a total of $3.4 billion out-of-pocket on these drugs.

What savings can patients expect?

How much individual patients save with the new discounts depends on the exact type of drug benefits they receive under Medicare Part D. Patient out-of-pocket costs, which can vary from plan to plan, include monthly premiums, flat-rate drug copayments and copayments that are a percentage of the drug cost.

Starting next year, Medicare Part D enrollees will face a $2,000 cap on their prescription drug out-of-pocket costs, eliminating costs for patients whose prescription drug bills exceed that limit, the Department of Health and Human Services said.

Medicare also plans to discount up to 15 more prescription drugs starting in 2027, 15 more drugs in 2028, and up to 20 more drugs each year after that, the Department of Health and Human Services said.