The United States has successfully negotiated substantial price reductions on 10 top-selling prescription drugs used by Medicare, with discounts as high as 79%. This move, which is part of President Joe Biden's Inflation Reduction Act signed into law in 2022, aims to save $6 billion in the first year, with new prices set to take effect in 2026. The legislation marks the first time Medicare has been allowed to negotiate prices for some of the most expensive drugs covered by the program, which serves 66 million people.

President Biden and Vice President Kamala Harris praised the achievement, with Biden stating, "We finally beat Big Pharma." Harris emphasized her long-standing commitment to holding pharmaceutical companies accountable and highlighted her crucial tie-breaking Senate vote that passed the law allowing these negotiations.

The price cuts are expected to ease the burden on Americans, particularly ahead of the closely contested November 2024 presidential election. However, Republicans, including House Speaker Mike Johnson, have criticized the move as "price fixing," arguing it will increase healthcare costs and stifle medical innovation.

The discounts negotiated vary, with Merck's diabetes drug Januvia facing the steepest reduction at 79%, and Novo Nordisk's insulin aspart products at 76%. The remaining drugs on the list will see cuts between 38% and 68%.

While the administration projects significant savings, the pharmaceutical industry has expressed concern, warning that these price cuts might not lower out-of-pocket costs for patients and could hinder future innovation. Despite these concerns, market reactions were mixed, with shares of some pharmaceutical companies, like Amgen and Bristol Myers Squibb, rising, while others, such as Eli Lilly and Pfizer, saw slight declines.

The next round of Medicare drug price negotiations is set to include 15 more drugs, with discussions beginning in February. Further details on how the 2026 price cuts were reached are expected to be provided by the government next year.