On Tuesday, November 25, 2025, the Trump administration announced a sweeping set of price reductions for 15 prescription drugs covered by Medicare, marking a significant next step in the federal government’s ongoing effort to rein in the soaring costs of medication for millions of Americans. The reductions, which will take effect in 2027, are projected to save Medicare enrollees about $685 million in out-of-pocket costs and slash government spending on those drugs by approximately $12 billion, according to the Centers for Medicare and Medicaid Services (CMS), as reported by CBS News and The Hill.
These new price cuts are part of the Medicare price negotiation program, a policy cornerstone originally created by the Inflation Reduction Act (IRA) of 2022 under President Joe Biden. While the initial round of negotiations took place last year under the Biden administration, the Trump administration has now expanded the program, touting even greater savings and broader impact. The medications targeted in this latest round include some of the most widely used—and expensive—treatments for chronic and life-threatening conditions such as cancer, diabetes, asthma, and Huntington’s disease.
Robert F. Kennedy Jr., Secretary of Health and Human Services, underscored the administration’s commitment to cost relief, stating, “President Trump directed us to stop at nothing to lower health care costs for the American people. As we work to Make America Healthy Again, we will use every tool at our disposal to deliver affordable health care to seniors.” (SAN News)
Among the drugs affected are Pfizer’s Ibrance, a breast cancer therapy used by 16,000 Medicare Part D beneficiaries last year, and Novo Nordisk’s blockbuster GLP-1 drugs—Ozempic, Rybelsus, and Wegovy—used for diabetes and weight loss. According to The Hill, nearly 2.3 million Medicare beneficiaries took these GLP-1 drugs in 2024, underscoring the broad reach of the new pricing policy.
The negotiated discounts are substantial, ranging from 38% to as high as 85% off the list prices. For example, the monthly price for Ozempic will drop from $959 to $274, and Wegovy will see a similar reduction, falling from $1,350 to $386 for a 30-day supply. Other notable examples include Trelegy Ellipta (an inhaler for asthma and COPD) dropping from $654 to $175, and Xifaxan (for irritable bowel syndrome) falling from $2,696 to $1,000. The drugs on the list accounted for $42.5 billion in prescription drug costs in 2024 before factoring in existing discounts and rebates, according to CMS data cited by The Hill.
But what does this mean for the average Medicare enrollee? While the government touts the overall savings, the individual benefit will depend on whether a person uses one or more of the discounted drugs and whether they hit their annual out-of-pocket spending cap. With 5.3 million people using these medications in 2024, the average savings equate to roughly $129 per Medicare enrollee, CBS News calculated. This comes on top of a $2,000 out-of-pocket spending cap for seniors introduced in 2025 under the IRA, a limit that will be adjusted for inflation and could reach about $2,200 by 2027. Once that cap is reached, Medicare enrollees pay nothing for covered prescriptions above that amount.
Advocacy groups have welcomed the move as a major victory for patients and taxpayers. Merith Basey, executive director of Patients For Affordable Drugs, told CBS News, “Medicare is using its bargaining power to lower prices on the most expensive drugs covered by the program. The savings gained from the new, lower negotiated prices are what allow the program to pay for the out-of-pocket cap.” Basey also emphasized, “The program’s ability to negotiate drug costs represents the most powerful tool we currently have in place to rein in drug prices and hold the pharmaceutical industry accountable.”
However, not everyone is convinced the program is an unmitigated win. The Pharmaceutical Research and Manufacturers of America (PhRMA) criticized the IRA’s negotiation policies, arguing that they threaten future medical innovation. In a statement, PhRMA spokesperson Alex Schriver said, “Flawed policies threaten future medical innovation by siphoning $300 billion from biopharmaceutical research. Whether it is the IRA or MFN [most favored nation], government price setting for medicines is the wrong policy for America.” (The Hill)
There are also questions about how these negotiated prices will interact with separate deals the Trump administration has struck with drugmakers. Earlier this month, President Trump announced a “most favored nation” agreement with Novo Nordisk and Eli Lilly to cut the price of weight loss drugs—including Ozempic and Wegovy—in exchange for tariff relief. Under that deal, the monthly cost for Medicare enrollees for these drugs will be $245, slightly less than the $274 negotiated by CMS. The agency told CBS News that the earlier deal’s pricing is “expected to supersede” the prices stipulated under the IRA, though the precise mechanics of how the two programs will work together remain unclear.
Participation in the negotiation program is technically voluntary for drug companies. However, as The Hill points out, any company refusing to participate would risk losing access to the enormous Medicare and Medicaid markets or face steep excise taxes. While some pharmaceutical firms have challenged the program in court, none of the lawsuits have succeeded so far.
The new price reductions follow last year’s negotiations, which targeted 10 other drugs for price cuts beginning in 2026. Those included Imbruvica (reduced by 38%), Stelara (66%), and Januvia (79%). The trend of rising drug costs, particularly for drugs that have been on the market for years, has been a source of concern for older Americans. For example, the irritable bowel disease drug Xifaxan, first available in 2004, has increased in price by a staggering 253% since its launch, according to AARP.
CMS Administrator Mehmet Oz contrasted the current results with those achieved during the Biden administration, stating, “Using the same process with a bolder direction, we have achieved substantially better outcomes for taxpayers and seniors in the Medicare Part D program—not the modest or even counterproductive ‘deals’ we saw before.” (The Hill) Still, the administration’s choice to announce these savings via press release during a holiday week—rather than with a high-profile White House event—sparked speculation about the political motivations behind the rollout. Chris Meekins, a health official in the first Trump administration and now an analyst at Raymond James, noted, “The announcement was made by press release during a holiday week which may be a sign these are not as significant as they could have been.”
Despite the political back-and-forth, the bottom line for millions of Americans is clear: prescription drug costs have been a top concern, especially for older adults. According to AARP, about two in five adults aged 50 and older worry about their ability to afford prescription drugs in the coming years. These latest Medicare price negotiations—regardless of which administration claims credit—represent a concrete step toward easing that burden, even as the debate over the best path forward continues.
As the new prices are set to take effect in 2027, Americans on Medicare and their families will be watching closely—not just for the savings, but for how these policies shape the broader future of drug pricing and health care in the U.S.
