The US government released this week the next 15 Rx drugs subject to price negotiations under the Inflation Reduction Act, the landmark legislation that put into place drug pricing reforms in the US.

By Patricia Van Arnum, Editorial Director, DCAT, pvanarnum@dcat.org

The next round in drug price negotiations
This week (January 27, 2026), the Centers for Medicare & Medicaid Services (CMS) within the US Department of Health and Human Services (HHS) announced the selection of 15 prescription drugs that are the latest drugs subject to price negotiations under the Medicare Prescription Drug Negotiation Program, which was authorized under the Inflation Reduction Act (IRA) of 2022. That law, for the first time ever, authorizes and requires the US government to negotiate with pharmaceutical companies prices for certain prescription drugs under Medicare, the US federal health insurance program for people 65 or older.

Under the Medicare Drug Price Negotiation Program, CMS directly negotiates with pharmaceutical companies the prices of certain high-expenditure (defined by levels of Medicare spending) and single-source drugs without generic or biosimilar competition. The 15 drugs (see Table I at end of article) selected by CMS represent the third round of drugs selected for price negotiations. The US government will now negotiate the prices of these drugs directly with pharmaceutical companies, with the negotiated prices, once agreed to, effective January 1, 2028.

Among the drugs selected for price negotiations in this latest round are Eli Lilly and Company’s Trulicity (dulaglutide) for treating Type 2 diabetes; Gilead Sciences’ Biktarvy (bictegravir / emtricitabine / tenofovir alafenamide) for treating HIV; Bristol-Myers Squibb’s Orcenia (abatacept) for treating psoriatic arthritis and rheumatoid arthritis; Novartis’ Cosentyx (secukinumab) for treating plaque psoriasis and psoriatic arthritis; and Johnson & Johnson’s Erleada (apalutamide) for treating prostate cancer (see Table I at end of article for all 15 drugs). New to this latest round is that it covers drugs payable under both Medicare Part B, which applies to prescription drugs administered in a physician’s office or clinical setting, and Medicare D, which covers most outpatient prescription drugs from pharmacies and other pharmacy providers.

Taking the tally: price-negotiated drugs under Medicare
In all, 40 prescription drugs have been subject to price negotiations under the Medicare Drug Price Negotiation Program since IRA was enacted in 2022—the 15 drugs selected this week for negotiation and 25 drugs for which the prices have already been negotiated and going into effect this year (2026) and next year (2027). CMS earlier selected 10 and 15 drugs covered under Medicare Part D for the first and second cycle of negotiations, respectively, that now have negotiated prices, which the statute refers to as maximum fair prices. These prices are effective beginning January 1, 2026, for the first cycle of 10 drugs and January 1, 2027, for the second cycle of 15 drug based on negotiations and agreements reached between CMS and participating drug companies.

The negotiated drug prices for the first 10 drugs under the Medicare Drug Price Negotiation Program were announced in 2024 and went into effect earlier this month (January 1, 2026). These 10 drugs are: AbbVie’s/Johnson & Johnson’s Imbruvica (ibrutinib); Amgen’s Enbrel (etanercept); AstraZeneca’s Farxiga (dapagliflozin); Boehringer Ingelheim’s (BI)/Eli Lilly and Company’s Jardiance (empagliflozin); Bristol-Myers Squibb’s/Pfizer’s Eliquis (apixaban); Johnson & Johnson’s (J&J) Stelara (ustekinumab) and J&J’s Xarelto (rivaroxaban); Merck & Co.’s Januvia (sitagliptin); Novartis’ Entresto (sacubitril/valsartan); and various formats for insulin apart, a short-acting insulin from Nov Nordisk, Fiasp, Fiasp FlexTouch, Fiasp PenFill,  NovoLog,  NovoLog  FlexPen, and NovoLog PenFill.

The second round of drugs subject to price negotiations (which consisted of 15 drugs) were announced last November (November 2025) with the negotiated prices taking effect January 1, 2027. Most notable of those 15 drugs are Novo Nordisk’s blockbuster glucagon-like peptide-1 (GLP-1) agonists, Ozempic/Rybelsus/Wegovy (semaglutide), respectively for treating Type 2 diabetes (Ozempic and Rybelus) and obesity (Wegovy). In addition to Novo Nordisk, other companies with products in the second round of negotiated drug prices were AbbVie, Amgen, Astellas, AstraZeneca, BI, Bristol-Myers Squibb, GSK,  Merck & Co., Pfizer, Salix Pharmaceuticals, and Teva Pharmaceutical.

These products were: AbbVie’s Linzess (linaclotide) for treating chronic idiopathic constipation and irritable bowel syndrome with constipation and AbbVie’s Vraylar (cariprazine hydrochloride) for treating bipolar I disorder, major depressive disorder, and schizophrenia; Amgen’s Otezla/Otezla XR (apremilast) for treating oral ulcers in Behcet’s disease, plaque psoriasis, and psroriatic arthritis; AstraZeneca’s Calquence (acalabrutinib) for treating chronic lymphocytic leukemia/small lymphocytic lymphoma and mantle cell lymphoma; BI’s Ofev (nintedanib esylate) for treating idiopathic pulmonary fibrosis, a chronic lung disease, and BI’s Tradjenta (linagliptin) for treating Type 2 diabetes; Bristol-Myers Squibb’s Pomalyst (pomalidomide) for treating kaposi sarcoma, a type of cancer forming lesions in the skin, and multiple myeloma; GSK’s Trelegy Ellipta (fluticasone furoate/umeclidinium bromide/vilanterol trifenatate) for treating asthma and chronic obstructive pulmonary disease and GSK’s Breo Ellipta (fluticasone furoate/umeclidinium bromide/vilanterol trifenatate) for treating asthma and chronic obstructive pulmonary disease; Merck & Co.’s Janumet/Janumet XR (metformin hydrochloride/sitagliptin phosphate) for treating Type 2 diabetes; Pfizer’s and Astellas Pharma’s Xtandi (enzalutamide) for treating prostate cancer and Pfizer’s Ibrance (palbociclib), for treating breast cancer; Salix Pharmaceuticals’ Xifaxan (rifaximin) for treating hepatic encephalopathy and irritable bowel syndrome with diarrhea; and Teva Pharmaceuticals’ Austedo/Austedo XR (deutetrabenazine), for treating chorea (a neurological movement disorder) in Huntington’s disease and tardive dyskinesia, an involuntary movement disorder caused by long-term use of certain medications.

Negotiating drug pricing under Medicare
The Medicare Drug Price Negotiation Program as authorized by IRA limits the number of drugs to be selected for price negotiations. Under the drug-price negotiation program, the HHS Secretary is authorized and required to select a specified number of drugs from a list of 50 “negotiation-eligible drugs” with the highest Medicare Part D spending and from a list of 50 “negotiation-eligible drugs” with the highest Medicare Part B spending over a given 12-month period. It limits the number of eligible drugs for negotiations to 10 Medicare Part D drugs in 2026, 15 Medicare Part D drugs in 2027, 15 Medicare Part B and D drugs in 2028, and 20 Medicare Part B and D drugs in 2029 and thereafter.

The program also limits the type of drugs eligible to be negotiated under the drug-pricing plan. For example, the plan applies only to “high-cost” drugs defined by levels of Medicare spending, “older” drugs, defined on the basis of the number of years from when a drug was approved by the US Food and Drug Administration, and drugs without generic-drug and biosimilar competition. Also, certain drugs, such as orphan drugs and plasma-derived products, are exempted.

Industry feedback
The Pharmaceutical Research and Manufactuers of America (PhRMA), which represents the innovator drug industry in the US, has long been critical of the drug pricing reforms under IRA and continues to assert it is not an effective way to address prescription drug costs in the US.

“The IRA [Inflation Reduction Act] continues to show why government price setting is the wrong approach for Americans,” said Elizabeth Carpenter, PhRMA Executive Vice President of Policy and Research, in a January 27, 2026, statement. “Since the law took effect, seniors have faced higher costs, fewer choices and more barriers to care while insurers and PBMs [pharmacy benefit managers]—who ultimately decide what patients pay—continue to operate with limited oversight.”

She also cites the negative impact of IRA in creating the so-called “pill penalty” and in having a negative impact on small-molecule drugs. The “pill penalty” under IRA and the Medicare Drug Price Negotiation Program relates to the time post approval for which drugs would be subject to price negotiation and when those negotiated prices would go into effect. The IRA currently provides the CMS the authority to negotiate the prices of small-molecule drugs at seven years with those prices going into effect at nine years after they come to market. For large-molecule drugs, or biologics, the IRA sets these timelines at 11 years post approval to start the negotiation process, and those prices would go into effect at 13 years post-market entry. The earlier time frame for which small-molecule drugs are subject to price negotiation comparative to biologics is referred to as the “pill penalty.” The Trump Administration issued an Executive Order in 2025 to eliminate the “pill penalty,” but such action requires legislation to amend the existing law under IRA.

 “At the same time, the law is undermining future medical progress,” said PhRMA’s Carpenter in the January statement. “As a result of the ‘pill penalty,’ investments in early-stage, small-molecule medicines have fallen nearly 70%, and post-approval cancer trials for small molecules are down more than 45%. CMS is now planning to set prices for additional small-molecule cancer treatments that would otherwise be spared without this penalty – driving even more investment away from these critical treatment options. Policymakers should fix the IRA pill penalty and rein in insurers and PBMs who decide what patients pay—because access to future cures depends on it.”

Table 1: The Third Round of 15 Prescription Drugs Selected for Price Negotiations under the Medicare Drug Price Negotiation Program (January 2026)