The Trump administration last week announced the “maximum fair price” (MFP) it will pay for 15 high-cost Medicare Part D drugs starting in 2027, but 340B experts said the negotiated prices for certain formulations of those medications may still be higher than their 340B ceiling prices.
The Centers for Medicare & Medicaid Services (CMS) on Nov. 25 released the MFPs that the federal government will pay for the negotiated drugs as of Jan. 1, 2027.
A source told 340B Report that, based on current National Drug Code (NDC) pricing data, 36 of the 89 active NDC formulations for the 15 selected drugs—or about 41%—appeared to have 340B prices below the MFPs for the second round of Medicare drug price negotiations. About a third of the selected drugs’ NDCs have a profit—or the difference between MFP and 340B price—of more than $100 per package.
The source did not specify which of the drug products have NDCs with MFPs higher than the 340B price. 340B ceiling prices are not publicly available and can change each quarter based on a drug’s average manufacturer price from the previous quarter.
Key Context
Under the 2022 Inflation Reduction Act (IRA), which authorized the negotiations, drugmakers must offer covered entities the lower of the MFP or the 340B ceiling price, but not both.
Provider advocates have voiced concerns that requiring covered entities to access 340B drugs at wholesale acquisition cost—even when the 340B ceiling price is lower than MFP and required to be provided by law—could affect the savings they have traditionally received on such drugs. They’ve also raised concerns about the lack of federal clarity on appropriate dispensing fees for drugs subject to the Medicare drug price negotiation program.
Jason Reddish, a principal at Powers Pyles Sutter & Verville which represents 340B providers, noted that the drugs selected for the 2027 IRA Medicare price negotiations included primary health drugs that federally qualified health centers in particular frequently prescribe.
“The loss of meaningful 340B savings on those drugs will be very painful for them, especially if HRSA does not end the rebate pilot,” he said in an email.
The 15 drugs selected for the second round of IRA Medicare drug price negotiations will not be included in the Health Resources and Services Administration’s (HRSA) 340B rebate pilot model, which will launch on Jan. 1, 2026. Still, provider advocates have voiced concerns about its potential expansion to include these and additional drugs in the future as more become eligible for negotiation
The 2027 pricing announcement came 10 months after CMS—in the final days of former President Joe Biden’s administration—unveiled the second group of drugs chosen for Medicare drug price negotiations. Despite initial uncertainty over whether the talks would occur, President Donald Trump signaled his support for the IRA negotiations in late January and has since made lowering prescription drug prices a key priority for his administration.
2027 Negotiated Prices
CMS announced the negotiated price for a 30-day supply of the selected drugs in 2027. They include:
- $274 for Novo Nordisk’s diabetes and weight loss drug Ozempic, Rybelsus, Wegovy;
- $175 for GlaxoSmithKline’s (GSK) lung disease and asthma drug Trelegy Ellipta;
- $7,004 for Pfizer and Astellas’ prostate cancer drug Xtandi;
- $8,650 for Bristol Myers Squibb’s (BMS) cancer drug Pomalyst;
- $7,871 for Pfizer’s breast cancer drug Ibrance;
- $6,350 for Boehringer Ingelheim’s (BI) lung disease drug Ofev;
- $136 for AbbVie’s constipation drug Linzess;
- $8,600 for AstraZeneca’s blood thinner drug Calquence;
- $4,093 for Teva’s Huntington’s disease and tardive dyskinesia drug Austedo, Austedo XR;
- $67 for GSK’s lung disease and asthma drug Breo Ellipta;
- $78 for BI’s diabetes drug Tradjenta;
- $1,000 for Salix Pharmaceuticals’ irritable bowel syndrome and Hepatic encephalopathy drug Xifaxan;
- $770 for AbbVie’s atypical antipsychotic Vraylar;
- $80 for Merck’s diabetes drug Janumet, Janumet XR;
- $1,650 Amgen’s immune disease drug Otezla.
Additional details on how the MFP applies across dosage forms for those 15 drugs is available on CMS’ website, the agency noted.
CMS has projected that Medicare prescription drug coverage enrollees would save an estimated $685 million in out-of-pocket costs under the defined standard benefit design when the new negotiated prices take effect in 2027.
The agency released the MFPs for the first 10 drugs selected for the 2026 IRA Medicare drug price negotiations in August 2024. A source told 340B Report on Monday that 65 of the 78 active NDCs (85%) for 2026 have lower 340B ceiling prices than MFP. Those prices will take effect on Jan. 1, 2026—the same day as HRSA’s 340B rebate pilot model.
CMS touted the announcement as a “net savings of 44%, or $12 billion, from last year’s negotiated Medicare spending.”
What They Said
CMS Administrator Mehmet Oz contended that “this year’s results stand in stark contrast to last year’s.”
“Using the same process with a bolder direction, we have achieved substantially better outcomes for taxpayers and seniors in the Medicare Part D program—not the modest or even counterproductive ‘deals’ we saw before,” he said in a statement.
Health and Human Services (HHS) Secretary Robert F. Kennedy Jr. added that the administration “will use every tool at our disposal to deliver affordable health care to seniors.”
But under November “Most Favored Nation” (MFN) deals with the Trump administration, drugmakers Eli Lilly and Novo Nordisk agreed to offer Medicare prices for Ozempic, Wegovy, Mounjaro and Zepbound of $245—below the IRA’s negotiated $274 MFP for Ozempic and Wegovy.
A Novo Nordisk spokesperson, when asked about the discrepancy, told 340B Report that the company “look[s] forward to additional clarity from CMS on how pricing and coverage will work together to support patient access as details are finalized.” They added that “the recently announced MFN agreement with the administration reflects a broader effort to expand access to obesity care across Medicare and Medicaid.”
The drugmaker further raised “serious concerns” about the IRA’s impact on patients and opposed what it called “government price setting.”
“We have seen that government price setting has not translated to lower out-of-pocket costs for patients and can lead to a loss of coverage for medications and higher insurance premiums,” the Novo Nordisk spokesperson said in an email. “We will continue to work with stakeholders and policymakers to expand affordable access to our medicines through both government and commercial insurance plans.”
Brand-name drug trade group, Pharmaceutical Research and Manufacturers of America (PhRMA), has also taken issue with the IRA’s drug price negotiation program.
PhRMA spokesperson Alex Schriver said in a Nov. 25 statement that “government price setting for medicines is the wrong policy for America” and “does nothing to rein in PBMs who decide which medicines are covered and what patients pay.”
“Our industry is stepping up to make medicines more affordable by enabling direct purchase at lower prices and investing in U.S. manufacturing and infrastructure,” he said. “But policymakers must act to tackle the true causes of rising costs: middlemen—like PBMs and 340B hospitals—inflating prices and foreign governments refusing to pay their fair share for breakthrough medicines.”
PhRMA has targeted the 340B program—specifcially 340B hospitals—in a series of recent ads.
The IRA authorizes CMS to negotiate MFPs for up to 15 additional drugs to take effect in 2028 and up to 20 more drugs for each subsequent year.
Correction: The original version of this story incorrectly described Otezla as a Merck product. It is an Amgen product. The story has been corrected.
Editor’s Note: Powers is a 340B Report sponsor. 340B Report maintains full editorial independence in its news coverage. View 340B Report’s editorial policy.
