The Centers for Medicare & Medicaid Services’ Innovation Center launched the Generating Cost Reductions for U.S. Medicaid (GENEROUS) model, a voluntary five‑year pilot that will negotiate outpatient drug prices for participating state Medicaid programs based on prices in selected comparator countries. Manufacturers that opt in will negotiate pricing with CMS; participating states will then invoice manufacturers for supplemental rebates to align Medicaid prices with the negotiated international benchmarks. CMS frames the model as a tool to rein in Medicaid drug spending—more than $100 billion in 2024—by anchoring prices to global references. The agency seeks manufacturer applications and state letters of intent, with rolling state enrollment through August of next year. CMS will capture a share of rebates via federal spending reductions. The program reflects the administration’s 'most favored nation' policy momentum and could pressure manufacturers to reassess U.S. pricing strategies. Drugmakers warn the approach might dampen investment incentives or prompt market exits; states and patient groups will monitor access, manufacturer participation, and impacts on supply and innovation.