A reintroduced provision in the final version of the One Big Beautiful Bill Act could allow more medications to sidestep Medicare drug price negotiations under the Inflation Reduction Act.

The measure, known as the Orphan Cures Act, broadens the exemption criteria for orphan drugs. Currently, the exemption only applies to orphan drugs designated for only one rare condition and approved for an indication (or indications) only for that condition. The provision expands that exemption to drugs with multiple rare disease indications.

Had the Act been passed earlier, two drugs with high gross Medicare Part D spending would be exempted in the first two rounds of negotiation: Pharmacyclics LLC’s Imbruvica (ibrutinib) and Bristol Myers Squibb’s Pomalyst (pomalidomide).

Four medications with orphan designations granted by FDA are likely to be selected for Medicare negotiation in 2028, according to a study published in the Journal of Managed Care & Specialty Pharmacy. Together, those drugs generated more than $10.8 billion in Medicare spending in 2023, according to CMS data.

Among them are two high-cost Part B oncology drugs:

• Merck’s Keytruda (pembrolizumab), the world’s best-selling cancer drug in 2024, has received 12 orphan designations and over 40 FDA approvals for various cancer types. Merck noted in its annual SEC filing that it expects U.S. sales of Keytruda to decline starting in 2028 due to the Medicare negotiation program.
  
• Bristol Myers Squibb’s Opdivo (nivolumab), a top-selling immunotherapy drug.

Another two Part D drugs with orphan designations that might be included in the negotiation list are:

• Gilead’s Biktarvy (bictegravir/emtricitabine/tenofovir alafenamide), a small-molecule HIV drug with $3.1 billion in Medicare Part D spending in 2023.
  
• Mallinckrodt’s Acthar (corticotropin), often prescribed for a range of autoimmune and inflammatory conditions.

While a Trump-era executive order sought to extend the negotiation exemption for new small-molecule drugs — a move to adjust the so-called “pill penalty” — that provision was left out of the final act.

In its latest draft guidance for the third round of Medicare drug price negotiations, CMS said it will announce the 2028 negotiation list by Feb. 1, 2026, with negotiated prices taking effect on Jan. 1, 2028. The agency also signaled it may revisit pricing for drugs already negotiated for 2026 or 2027.

The Orphan Cures Act has received strong backing from the pharmaceutical industry, which argues that it will encourage more investment in rare disease treatments. According to OpenSecrets, 26 pharmaceutical companies and organizations have registered to lobby on the bill. After being omitted from an earlier version, the provision was reinstated in the final One Big Beautiful Bill Act package.

The Congressional Budget Office (CBO) estimates that the orphan drug exemption will yield $5 billion in industry savings over the next decade.

Meanwhile, pharmaceutical lobbying is surging. Industry giants like Sanofi, Pfizer, and Johnson & Johnson significantly boosted their lobbying expenditures in the first quarter of 2025. PhRMA, the industry’s main lobbying group, spent nearly $13 million, a 33% increase from the same quarter in 2024, making it the top lobbying spender in the drug industry and the second-largest overall.