Drugmakers hike prices in 2026. How much more will you spend?

Trump, pharmaceutical companies strike deal to cut drug prices

U.S. President Donald Trump and nine major pharmaceutical companies on Friday (December 19) announced deals that will slash the prices of their medicines for the government’s Medicaid program and for cash payers, in his latest bid to align U.S. costs with those in other wealthy nations.

Pharmaceutical companies hiked prices on hundreds of drugs so far in January, ushering in 2026 with steeper costs for everything from the COVID-19 vaccine to Ozempic despite the Trump administration’s efforts to bolster affordability.

Companies raised list prices on more than 850 drugs by a median 4% over 2025 prices, according to data from 46brooklyn Research, a drug pricing nonprofit. The changes implemented as of Jan. 9 are on par with the amount drug companies raised prices in 2025.

List prices typically are not how much consumers pay at the pharmacy counter or for mail order prescriptions. Factors such as rebates, insurance discounts and copayments, deductibles and coinsurance all determine how much people must spend to pick up prescriptions.

But list price hikes make medications pricier for consumers and insurers and “are something we see every year,” said Leigh Purvis, AARP’s prescription drug policy principal.

Annual price hikes are less than a decade ago, when yearly increases typically exceeded 10%, Purvis said. But she said drug companies are launching new brand name drugs at higher prices.

“We know that the median launch prices are now approaching $400,000 per year,” Purvis said. “So while the percentage might look a little bit smaller, it actually can lead to a pretty big price increase.”

How much are prices changing?

Pfizer has hiked list prices on dozens of medications, including cancer drug Ibrance, migraine pill Nurtec and COVID-19 treatment Paxlovid, as well as hospital-administered drugs such as the synthetic opioid Demerol.

The list price for Pfizer’s COVID-19 vaccine Comirnaty jumped 15%, among the company’s largest price hikes for non-hospital medications.

In a statement, Pfizer said average list prices increased less than the rate of inflation. The pharmaceutical giant said net prices − the amount it collects after rebates and insurance discounts − have decreased in recent years.

“The modest increase is necessary to support investments that allow us to continue to discover and deliver new medicines as well as address increased costs throughout our business,” Pfizer’s statement said.

Novo Nordisk and Eli Lilly each raised list prices for blockbuster diabetes drugs Ozempic and Mounjaro by 3%. Most insurers cover Ozempic and Mounjaro when prescribed to treat diabetes, but half of large employers don’t cover the weight-loss versions of these medications, according to a survey by benefits consultant Mercer.

In 2025, both companies announced price cuts for their weight-loss drugs, Wegovy and Zepbound, for cash-paying consumers. Lilly slashed prices for its weight loss drug Zepbound for consumers who buy the prescription medication directly from the drugmaker. In a similar deal, Novo discounted Wegovy for consumers who buy from the drugmaker, telehealth partners or retail pharmacies.

Drugmakers confront federal pressure to lower prices

The price hikes come despite federal efforts to limit price increases for some Americans. The 2022 climate and health law, the Inflation Reduction Act, allowed Medicare to negotiate prices on a limited number of drugs for older Americans enrolled in the federal health program.

Medicare enrollees in January will save an average of more than 50% on out-of-pocket costs beginning on the first 10 drugs prescribed to treat cancer, heart disease, autoimmune conditions and diabetes, according to an AARP analysis. The drugs are Eliquis, Jardiance, Xarelto, Januvia, Farxiga, Entresto, Enbrel, Imbruvica, Stelara and NovoLog.

President Donald Trump also has pressured drugmakers to lower prices under the threat of tariffs. Called “most favored nation” deals, the Trump administration negotiated prices with more than a dozen pharmaceutical companies to sell discounted medications to federal health programs and TrumpRx, his administration’s direct-to-consumer website expected to launch early 2026.

On Jan. 15, Trump unveiled his health plan that he said will pressure drugmakers to lower prices.

The president said his plan “locks in the massive discount on prescription drugs” through most favored nation pricing. “It’ll bring down drug prices 80, 90% in some cases, just numbers that nobody’s ever heard of before,” Trump said.

Health analysts said the TrumpRx discounts would mainly be used by nearly 1 in 10 Americans who don’t have health insurance. Those uninsured people could save about $2 billion on brand drug spending via TrumpRx discounts, according to a research note from ING Research.

That represents a fraction of the $700 billion spent on pharmaceuticals in the U.S, ING said.

“The deals that the Trump administration made with pharmaceutical companies don’t change the fundamentals of the system,” said Diederik Stadig, an ING Research health care and technology economist. “They’re a workaround for a very small part of the market.”

Rebates, government requirements inflate prices

Experts say list prices often don’t reflect the dynamics of drug pricing and reimbursement.

46brooklyn analyzed drug price changes for Medicaid, the federal and state health program for low-income families and people with disabilities. The analysis, which is based on how often drugs are prescribed and purchased, showed prices dropped slightly in 2026.

Medicaid often demands drug companies pay lucrative rebates for medications. Another federal drug program, called 340b, allows hospitals and health providers to purchase drugs at a discount and collect lucrative reimbursement from federal health insurance programs. Hospitals and other health providers generate revenue from the pricing spread that allows them to provide other services.

Government requirements such as Medicaid rebates and 340b discounts often artificially raise drug prices for consumers and insurers to generate revenue for hospitals and other health providers, said Antonio Ciaccia, CEO of 46brooklyn.

He said Congress must address such rebate programs to lower drug prices for consumers.

“You can’t have your cake and eat it too,” Ciaccia said. “You either want low prices or you don’t.”

Contributing: Reuters

Reach the reporter at alltuck@usatoday.com.

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