Medicare Names 15 New Drugs for Third Round of Cost-Cutting Price Negotiations

Talks are expected to produce billions in savings for high-cost drugs in 2028

Tony Pugh,

AARP

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Published January 27, 2026

blue background featuring a stylized two-way arrow cutout filled with numerous red, white, and blue medicinal capsules. The arrows split to the left and right, symbolizing choice and direction in healthcare and prescription drug options

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Key takeaways

Lower prices for these drugs won’t be effective until 2028.
2022 law, paired with negotiations, help lower drug costs.
The schedule for Medicare savings can be confusing.
High drug costs are a major concern for older adults.

Drugs to treat arthritis, cancer, Crohn’s disease, diabetes and HIV are among the 15 popular, high-cost prescriptions that the Centers for Medicare & Medicaid Services (CMS) tapped Jan. for the third round of Medicare-negotiated price reductions.

About 1.8 million beneficiaries use these medications, which account for about $27 billion in Medicare Part D spending. CMS will bargain with drug makers during the year and is required to release the results by Nov. 30.

“Today’s announcement marks yet another significant next step forward in our long-standing efforts to lower prescription drug prices,” says Dr. Myechia Minter-Jordan, AARP’s CEO. “Older Americans across the political spectrum consistently say lower drug prices are a top priority.”

The medications’ lower negotiated prices will take effect Jan. 1, 2028. All Medicare Advantage plans that include prescription coverage and all stand-alone Part D drug plans available to beneficiaries in original Medicare must cover each medicine.

Anoro Ellipta for chronic obstructive pulmonary disease (COPD)
Biktarvy for the most common strain of HIV, HIV-1
Botox, Botox Cosmetic for chronic migraines, overactive bladder, abnormal contraction of muscles
Cimzia for Crohn's disease, rheumatoid arthritis
Cosentyx for severe plaque psoriasis
Entyvio for Crohn's disease
Erleada for prostate cancer
Kisqali for breast cancer
Lenvima for kidney, liver and thyroid cancers
Orencia for psoriatic arthritis, rheumatoid arthritis
Rexulti for agitation associated with dementia, major depressive disorder, schizophrenia
Trulicity for type 2 diabetes
Verzenio for breast cancer
Xeljanz, Xeljanz XR for psoriatic arthritis, rheumatoid arthritis, ulcerative colitis
Xolair for asthma, chronic hives

In addition, CMS announced that another drug on Medicare's list for bargaining last year, Tradjenta, was selected for price renegotiation. It is used to treat type 2 diabetes, and its renegotiated price will take effect in 2028 along with the 15 on the list above..

Up to 20 additional drugs covered under Medicare Part D or Part B could be selected for price negotiations for 2029 and later years under provisions of the 2022 prescription drug law.

Legislation, price negotiations helped lower costs

Federal law allows Medicare to select and negotiate prices with pharmaceutical companies on certain high-cost and widely used medications. It also requires drug manufacturers to pay a rebate to Medicare if their prices rise faster than the general rate of inflation.

The first round of Medicare drug price negotiations in 2024 produced lower prices for 10 medications. Those took effect Jan. 1, 2026.

The prescriptions include treatments for arthritis, blood clots, cancer, diabetes, heart failure and kidney disease. As a result, Part D enrollees are expected to save $1.5 billion in out-of-pocket costs this year.

Lower prices that Medicare already has negotiated on 15 additional drugs take effect Jan. 1, 2027.

About 5.3 million beneficiaries used these drugs in 2024, accounting for $42.5 billion in Part D spending in 2024. Medicare is expected to save as much as $12 billion a year on those prescriptions; Medicare beneficiaries in Part D plans will save about $685 million in out-of-pocket costs, CMS reported.

The 15 medications include treatments for asthma, cancer, chronic obstructive pulmonary disease (COPD) and diabetes. The list also includes the popular GLP-1s Ozempic, Rybelsus and Wegovy that treat cardiovascular disease, type 2 diabetes and obesity. Medicare spent $15.2 billion on these GLP-1 medications in 2024.

Drug negotiation process can be confusing

The timetable for negotiations with pharmaceutical manufacturers can be hard to follow.

Lower prices for the drugs selected this year for the talks won’t go into effect for almost two years, more than a year after they’re settled, so manufacturers and Part D prescription plans can ready their computer systems, drug coverage lists and marketing. That means a new list of medications for price negotiations will be announced by Feb. 1, 2027, before prices from the 2026 list are rolled out for Medicare beneficiaries on Jan. 1, 2028.

Drug companies can opt out of negotiations, but they face a steep tax on U.S. sales of the drug if they don’t participate. The only way to avoid that tax is to withdraw from the Medicare and Medicaid drug programs, which account for about 40 percent of the country’s prescription drug spending.

High drug costs a concern for older adults

Almost 3 in 5 adults 50 and older are concerned about the cost of prescription drugs, according to a December 2024 AARP survey that included both people of Medicare age and younger. And 96 percent believe the government should do more to lower pharmaceutical prices.

That survey was taken right before a new $2,000 cap on out-of-pocket prescription drug expenses took effect in 2025. The federal Department of Health and Human Services, which oversees Medicare, estimated in January 2025 that about 11 million Part D enrollees, 20 percent, would reach the limit. The cap increased to $2,100 this year.

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Tony Pugh is an award-winning writer and editor covering Medicare for AARP. He has also covered Medicare for Bloomberg Law and as a national correspondent for Knight Ridder/McClatchy Newspapers.