U.S. Medicare Cuts Prices on 15 Top Drugs in Push to Lower Prescription Costs

25 November 2025

The U.S. government has announced that it will apply negotiated prices to 15 of the most expensive prescription drugs covered by Medicare, a major move aimed at reducing costs for millions of older Americans and people with disabilities.

The new pricing deal, part of a second round of negotiations under the framework enabled by the Inflation Reduction Act, is set to take effect in 2027. Among the drugs included are well-known medications such as Ozempic and Wegovy widely used for diabetes and weight-management along with treatments for a variety of conditions, from asthma to irritable bowel syndrome.

Officials estimate that the negotiated prices will collectively cut Medicare’s spending on those 15 drugs by about 36 percent compared with prior costs. The reductions are expected to save around $8.5 billion in net covered prescription drug costs over time.

For patients, this translates into real financial relief. Beneficiaries who rely on expensive medications could see more predictable out-of-pocket costs when the new prices take effect. Because Medicare serves over 67 million people including seniors and individuals with certain disabilities, the reach and impact of this change are substantial.

This second wave of negotiated pricing builds on an earlier round in which 10 high-cost drugs had their prices lowered, with an average 22 percent reduction compared with previous Medicare net prices.

The negotiations reflect a shift in Washington’s approach to drug pricing. For decades, Medicare was banned from negotiating directly with drugmakers; the Inflation Reduction Act changed that. Now, the government can directly engage manufacturers to set more affordable “maximum fair prices.”

Advocates of the policy argue that negotiated pricing is not only fairer for patients but also strengthens price transparency and ensures that taxpayers no longer subsidize steep pharmaceutical costs. Because Medicare now has leverage, experts expect that other payers including private insurers, may eventually push for similar discounts.

Nevertheless, not all observers are fully satisfied. Some health-policy experts note that while the discounts are meaningful, negotiated prices remain higher than drug prices in many other high-income countries. This has led to questions about whether the U.S. could push further, using international benchmarks or other tools to drive deeper savings.

For pharmaceutical companies, these negotiations pose a challenge. The cuts may compress margins and raise concerns about funding for research and development. Some manufacturers argue that price reductions could limit their ability to invest in new drug innovations.

From a broader perspective, the forthcoming 2027 price changes mark one of the most significant government interventions in U.S. drug pricing in decades. The reforms could reshape the market for brand-name drugs, influence how future medications are priced, and set a precedent for further negotiations.

For patients using Medicare, the change could mean more accessible and affordable medications especially for chronic conditions that require long-term treatment. With millions potentially benefiting, the initiative may meaningfully ease financial burdens tied to healthcare costs.

As the new prices approach, many stakeholders will be watching closely, patients, insurers, lawmakers, and pharmaceutical companies. The date is on the calendar. For now, the message from Washington is clear: drug pricing is no longer untouchable, and price relief for some of America’s costliest medications is on the way.