The U.S. government announced yesterday that prices for 10 prescription drugs have been significantly reduced for Medicare users. This milestone comes from the first-ever direct negotiations between drug companies and the Medicare agency, made possible by the 2022 Inflation Reduction Act.

These drugs, which treat conditions ranging from blood cancer to diabetes, are typically high-cost and lack generic alternatives. The new prices, in some cases slashed by nearly 80%, are set to take effect in 2026. Officials estimate that Medicare will save approximately $100 billion over five years, while individual users could see a total of $1.5 billion in out-of-pocket savings, thanks to a potential $2,000 annual cap. The Inflation Reduction Act also mandates that many additional drugs become eligible for price negotiations each year.

Since 1960, U.S. retail drug prices per capita have surged by over 1,000% when adjusted for inflation, with costs in the U.S. nearly three times higher than in other high-income countries. Learn more about the reasons behind this disparity HERE.