Legislative Changes Delay Medicare Drug Price Negotiations for Expensive Cancer Medications
Recent legislative developments have delayed and exempted some of the most costly prescription drugs, including major cancer treatments, from Medicare negotiation processes established under the Inflation Reduction Act. This change emerged from a budget bill passed by Republicans, which restricts Medicare's ability to negotiate drug prices for leading high-cost medications such as Keytruda, Opdivo, and Darzalex. These drugs, which were slated for price negotiation starting in 2026, will now maintain high prices for several more years, impacting seniors and people with disabilities who face substantial out-of-pocket costs.
Keytruda, a leading cancer drug on the market since 2014, exemplifies the financial burden associated with current pharmaceutical pricing, with annual costs ranging between $150,000 and $175,000 per patient and generating over $29 billion in global sales in 2024 alone. Medicare's fee-for-service program spent $5.5 billion on Keytruda in 2023. The policy change effectively delays cost reduction opportunities designed to alleviate such expenses for patients and taxpayers alike.
This development reflects ongoing tension between efforts to control drug costs within public insurance programs and pharmaceutical industry lobbying. While initially intended to empower Medicare to lower prices, the drug price negotiation provision has been curtailed, leading to criticism from policymakers advocating for stronger negotiations and controls on drug prices.
Senator Catherine Cortez Masto and Senate Finance Committee Ranking Member Ron Wyden have publicly criticized the policy shift, highlighting its implications for Medicare beneficiaries and the overall healthcare system. They emphasize the need to repeal provisions preventing Medicare from negotiating drug prices, citing the financial strain on patients with cancer and other serious diseases.
The debate underscores broader concerns about balancing pharmaceutical innovation incentives with affordability and access, particularly within federally funded healthcare programs. Legislative and regulatory frameworks continue to evolve as stakeholders negotiate the complex dynamics between cost containment, industry profitability, and patient care standards.
Healthcare fraud and abuse oversight, including measures to protect vulnerable populations’ access to care, remain relevant policy areas for lawmakers like Senator Cortez Masto. Further legislative efforts are being considered to strengthen such programs without reducing healthcare access for millions of Americans.