negotiations, a goal of Democrats and supported# by much of the American public for decades.

The 10 medications selected today are among those# that cost Medicare the most money and could save## the government billions of dollars, but drug# manufacturers are attempting to block the effort.

Stephanie Sy has the details.

STEPHANIE SY: These price negotiations are of a program established by the# Inflation Reduction Act last year with the goal of making popular drugs more# affordable to older and disabled America It gives the government, through Medicare,# the authority to negotiate lower prices## with pharmaceutical companies# for select medications.

Today,## the Biden administration listed the# first 10 drugs up for negotiation.

Popular blood thinners like# Eliquis and Xarelto are on the,## list as well as diabetes medications like# Jardiance.

Last year, just these 10 drugs## cost Medicare recipients $3.4 billion out of# pocket and cost the Medicare program $50 billion.

President Biden celebrated the# milestone at the White House today.

JOE BIDEN, President of the United States: Today# is the start of a new deal for bi g pharma doesn't just get a blank check at your# expense and the expense of the American peo On my watch, health care should be a# right, not a privilege, in this country.

STEPHANIE SY: Pharmaceutical companies, which# have mounted legal challenges to the law,## have to negotiate or face heavy tax penalties.

The new prices will only take effect in 2026.

Stacie Dusetzina has been watching# all of this closely.

She's a professor## of health policy and cancer research at# Vanderbilt University School of Medicine.

Stacie, explain why this announcement is such a## big deal.

And how will it impact people# that take those specific 10 medica STACIE DUSETZINA, Vanderbilt University:# So, it's a really big deal, because when## Medicare Part D was first enacted, Medicare was# banned from negotiating drug prices directly.

So this is the first time that the# program has been able to negotiate## for individual drug prices across all Medicare# beneficiaries.

So, it is really a historic step.## Now, for people who take these drugs that are on# the list, some of them will actually see direct## benefits in their prices going down by the# time the new prices are implemented in 2026.

That includes anybody who's paying a# deductible or paying a coinsurance,## a percentage of the drug's price.

So, for# -- especially for many of the drugs on the## list that are somewhat lower prices,# they're chronic disease medications## that are filled every month, patients may# actually see their prices go down directly.

But many people will see their# prices go down indirectly,## because they will get the benefits of# having Medicare redesigned, and have the## new $2,000 out-of-pocket cap as part of their# benefit.

And that will go into effect in 2025.

So the good news for Medicare beneficiaries# and people who know Medicare beneficiaries is,## those changes are coming even earlier than# the negotiated prices.

But the negotiation is## being used in part to pay for# that expansion of benefits,## so that premiums don't have# to go up to compensate.

STEPHANIE SY: What about the fact# that there were several pe nding to block the implementation of the law?

STACIE DUSETZINA: Yes, I mean, that's a real# concern is that, if and the negotiations were stopped, that# would be a large amount of savings that## are expected to help pay for expanding# the benefit that would no longer be there.

So I think one of the concerns, if we lost drug# price negotiation, is that premiums would then## have to rise to compensate for this improvement in# benefits.

And I think that has real implications## for people who may already struggle to pay# premiums to have health insurance coverage today.

STEPHANIE SY: That would be a serious# side effect, if that were to be the case.

The pharmaceutical companies that make# these drugs claim that forcing them to## lower prices will mean less money they can# put toward the research and the development## of new needed treatments.

In fact, one# industry group said today that Biden's## Moonshot for finding a cure for cancer# is in jeopardy because of this policy.

What's your view on that# being a side effect of this?

STACIE DUSETZINA: So I think it is important# to recognize that we ask for a lot fr pharmaceutical industry.

And there's a# lot of investment into the pharmaceutical## industry that really is there because of the# high returns that they are able to bring.

That said, the law only is focusing on older drugs# and drugs that have really been blockbusters in## the Medicare program.

So the companies that# have made these products have really reaped## handsome profits from those drugs for many years,# before they're even eligible for negotiation.

So I think, when we consider the real question# of trade-offs and effects on innovation,## this is a good way for us to get real# experience with understanding how lower## prices affect innovation in a way that has# some important guardrails on the process.

STEPHANIE SY: There's clearly a lot# that still has to be worked out.

Is just the fact that the federal# government may begin negotiating## directly with pharmaceutical companies for# drug prices, is that leading to shifts that## could affect Americans concerned# about these prices more broadly?

STACIE DUSETZINA: Well,## I think there co But, by and large, we expect most of these changes# to be for Medicare beneficiaries I will sa it is important to recognize that, as taxpayers,# we all contribute to the Medicare program,## so savings to Medicare are actually savings# to both the people benefiting from the program## right now and those of us paying taxes# that are helping to support the program.

STEPHANIE SY: Stacie Dusetzina at# Vanderbilt University, thank you so much.

And if you want more information# about the 10 drugs selected today,## you can find a detailed list and# more on our site at PBS.org/NewsHour.