Pharmaceutical giant AbbVie is one of the latest companies to be targeted by the US as the government plans to slash the price it pays for one of its key products, Botox, which is manufactured almost entirely in Ireland.
The US is planning to slash the price it pays for the cosmetic product along with several other medicines as part of legislation aiming to save the government over $200m (€168m).
AbbVie, the company behind Botox, makes almost of all of the product in Westport, Co Mayo. Production for the popular drug takes place in a highly secure plant given Botox is made from one of the world’s most toxic substances, botulinum toxin.
Recently-filed documents show that while AbbVie’s production facility for Botox supplies products worldwide, the US is the company’s largest market in terms of revenue, accounting for 67% of total turnover.
Operating profit at the Westport plant rose by 9% to €1.85bn at the end of 2024, with the company also growing its workforce by 6%, bringing its total headcount to over 1,600.
The company had major capital projects in progress to expand its production capacities and to strategically position its manufacturing facility for the introduction of new products, AbbVie also noted.
However, Botox, along with 13 other medications, will now be subject to government price negotiations over the next year as part of the US’s Inflation Reduction Act, an effort to reduce drug costs for the Medicare health program for seniors.
The move is set to bring further uncertainty for the pharmaceutical sector, an industry that spent the last year navigating Donald Trump’s punitive tariff measures and threats of punishment if they don’t move operations back to the US.
The Trump administration had until the start of February to announce the next round of drugs selected for price cuts, which will take effect in 2028.
In addition to Botox, other drugs selected in this cycle include Eli Lilly’s Trulicity, a once-weekly diabetes shot and the predecessor to its blockbuster drugs Mounjaro and Zepbound, the key ingredients for which are made at its facility in Kinsale. The drug is one of Lilly’s best-selling medications, bringing in around $5.3bn (€4.4bn) in sales in 2024.
Also included in the list are Gilead Sciences’ HIV pill Biktarvy and Novartis’ arthritis treatment Cosentyx were also on the list.
In total, the selected drugs accounted for approximately $27bn (€22.6bn) in total prescription drug spending under Medicare Part B and Part D, representing about 6% of total spending.
Under US law, a handful of drugs commonly prescribed to Medicare patients are selected for negotiations each year, resulting in price cuts that are estimated to save the government $237bn (€198bn) over a decade. Novo Nordisk’s best-selling weight-loss and diabetes drugs Wegovy and Ozempic headlined the 2025 list of drugs targeted for negotiations.
Drugmakers have fought the price negotiations with lawsuits and claims that the lower prices deplete them of incentives to develop new drugs.
The targeted companies will have until the end of February to decide if they will participate in negotiations.
