Thousands of Medicare recipients will face higher costs for expensive cancer drugs following passage of two provisions in the One Big Beautiful Bill Act, signed by President Donald Trump in July, The Wall Street Journal reported Aug. 3.
Two provisions in the law will delay Medicare price negotiations for some of the best-selling drugs in the world. This includes Merck’s cancer drug Keytruda, which had $17.9 billion in U.S. sales in 2024 and will see negotiations delayed by at least a year. Johnson & Johnson’s Darzalex, estimated to cost Medicare $5.6 billion last year, will be excluded from price negotiations entirely.
The delayed price negotiations — or exemption from price negotiations altogether — of the drugs will cost Medicare at least $5 billion in missed savings over 10 years, according to an estimate by the Congressional Budget Office.
The Inflation Reduction Act of 2022, passed under former President Joe Biden, gave Medicare the power to negotiate drug prices, but the new law expands the exemptions, specifically for drugs to treat a rare, or “orphan” disease. Keytruda, originally approved as an orphan drug in 2014, won broader approval in 2015, yet the One Big Beautiful Bill Act resets the negotiation timeline based on the later approval.
Other drugs that will no longer be available for negotiation next year include Bristol Myers Squibb cancer drugs Opdivo and Yervoy, which were estimated to cost Medicare $4.7 billion and $933 million, respectively, in 2024. AbbVie’s blood cancer pill Venclexta, estimated to have cost Medicare $814 million, will also be excluded under the new rules.
