Guidance for Second Medicare Drug Price Negotiation Released

The U.S. Department of Health and Human Services, through the Centers for Medicare and Medicaid Services (CMS), has released final guidance outlining the process for the second cycle of negotiations under the Medicare Drug Price Negotiation Program. The guidance also explains how CMS will help ensure people with Medicare can access drugs at the negotiated prices from the first and second cycles when those prices become effective beginning in 2026 and 2027.

CMS will announce the selection of up to 15 additional drugs covered by Part D for the second cycle of negotiations by Feb. 1, 2025. This second cycle of negotiations with participating drug companies will occur during 2025, and any negotiated prices for this second set of drugs will be effective starting Jan. 1, 2027.

This final guidance incorporates lessons learned from the first cycle of negotiations, and outlines requirements and parameters for how participating drug companies must ensure eligible people with Medicare prescription drug coverage will have access to the negotiated prices for 2026 and 2027, including procedures that apply to participating drug companies, Medicare Part D plans, pharmacies, mail order services and other entities that dispense drugs covered under Medicare Part D. Notably, the final guidance states that CMS will engage with a Medicare Transaction Facilitator that will serve as the infrastructure in the exchange of data and the optional facilitation of payments to ensure eligible individuals with Medicare and the pharmacies that serve them have access to the maximum fair prices.

“We are continuing to implement the prescription drug law thoughtfully, prioritizing engagement with all interested parties, and ensuring the process is as transparent and inclusive as possible,” said Meena Seshamani, MD, PhD, CMS deputy administrator and director of the Center for Medicare. “As we approach the second cycle of negotiations, we continue to focus on ensuring people with Medicare prescription drug coverage have access to the innovative cures and therapies they need at prices they can afford.”