Janumet and Janumet XR, combination pills that pair metformin with sitagliptin to treat type 2 diabetes, currently list at $526 for a 30-day supply under the pricing benchmark Medicare uses in its drug negotiations. Starting January 1, 2027, that same 30-day supply carries a negotiated price of $80 for people enrolled in Medicare Part D, an 85 percent reduction reached between the Centers for Medicare & Medicaid Services and manufacturer Merck Sharp & Dohme LLC. The cut comes from the second round of the Medicare Drug Price Negotiation Program, the mechanism created by the Inflation Reduction Act that lets Medicare set a ceiling price on a small number of costly drugs. It is a comparison between two list prices, not a preview of what any individual pays at a pharmacy counter.
Janumet’s 85 Percent Cut, By the Numbers
The $80 figure is one line in a CMS table listing negotiated prices for all 15 drugs selected for the program’s second cycle, alongside each drug’s Medicare footprint in 2024. That year, 239,000 Part D enrollees were dispensed Janumet or Janumet XR, and the drug accounted for just over $1.06 billion in total Part D gross covered prescription drug costs. Diabetes medications taken daily for years, rather than for a short course, make up a recurring share of the program’s target list for that reason.
CMS describes the $526 figure as the drug’s Wholesale Acquisition Cost, or list price, for a 30-day supply based on 2024 prescription fills (the same reference point used throughout the negotiation), according to the agency’s fact sheet on the second round of negotiated prices. The negotiated price, which the statute calls a maximum fair price, takes effect January 1, 2027, and remains in place for as long as Janumet stays a selected drug in the program, adjusted afterward each year by the change in the Consumer Price Index.
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Tradjenta and Breo Ellipta Post Comparable Cuts
Janumet is not the only drug on the 2027 list with a steep reduction. Tradjenta, a once-daily diabetes pill made by Boehringer Ingelheim Pharmaceuticals, drops from a $488 list price to a $78 negotiated price, an 84 percent cut. Breo Ellipta, an inhaled treatment for asthma and chronic obstructive pulmonary disease from GlaxoSmithKline, falls from $397 to $67, an 83 percent reduction, in the same CMS table.
All three drugs are among 15 medications covered under Part D that CMS selected for the program’s second negotiation cycle, a group that also includes treatments for prostate cancer, multiple myeloma, and chronic idiopathic constipation. CMS and the participating manufacturers reached agreement on prices for all 15 drugs by November 1, 2025, closing a negotiation period that opened with the agency’s initial offers the previous June.
Why the List Price Is Not What Anyone Pays at the Register
The $526-to-$80 comparison describes a shift in the ceiling a manufacturer can charge, not the amount an individual enrollee hands over at checkout. What a person actually owes for Janumet in 2027 depends on a plan’s specific formulary tier for the drug, any deductible still owed for the year, and how much of the plan’s cost-sharing structure has already been used. An enrollee whose plan already places Janumet on a low-cost tier, or who has already satisfied a deductible, will not necessarily see a bill fall by $446 in January.
CMS frames the negotiated price as a ceiling that a participating manufacturer must make available to pharmacies and other dispensing entities, not a guaranteed retail price at every counter. The agency has said it will publish a fuller explanation of how each 2027 price was reached, including for Janumet, by March 2026, ahead of the prices taking effect.
How CMS and Merck Reached the $80 Price
Under the Inflation Reduction Act, CMS negotiates directly with each selected drug’s manufacturer rather than setting a price on its own. For the 2027 group, participating companies had until March 1, 2025, to submit data to CMS, and CMS sent each company an initial offer with a written justification by June 1, 2025. Companies then had 30 days to accept that offer or propose a counteroffer, followed by negotiation meetings held in person and by video through the summer and fall.
Across the 15 selected drugs, CMS says agreement was reached for eight of them through those negotiation meetings or additional written price exchanges, while the remaining seven were settled after CMS sent final offers that participating companies accepted by the statutory deadline of October 31, 2025. The full negotiation period, covering all 15 drugs including Janumet, closed on November 1, 2025.
Formularies Must Keep the Negotiated-Price Drugs in 2027
Federal law requires standalone Part D plans and Medicare Advantage prescription drug plans to include a selected drug in their formularies once CMS and the manufacturer have agreed to a negotiated price, meaning Janumet, Tradjenta, and Breo Ellipta cannot be dropped from Part D coverage the way a plan might drop an ordinary drug during annual formulary changes. CMS has said it will use its formulary review process to watch for plan practices that could undermine access to the newly priced drugs once they take effect.
The negotiated prices apply for as long as each drug remains in the program and are adjusted each year afterward by the change in the Consumer Price Index for all urban consumers, according to CMS’s fact sheet, rather than reset through a fresh round of negotiations with the manufacturer.
This article was produced with the assistance of AI and reviewed by The Financial Wire editorial team.
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David M. Keller is a finance writer based in Columbus, Ohio, covering personal finance and consumer-focused economic topics. He earned his degree in journalism from Ohio University and began his career reporting on local business and economic trends for a regional media outlet. Since then, he has contributed to a variety of online publications, focusing on clear, practical coverage of topics such as cost of living, debt, and everyday financial decision-making.
