US President Donald Trump announced on Sunday that he will sign an executive order aimed at lowering prescription drug prices in the United States to match those paid by other wealthy nations—prices he claimed are 30% to 80% lower.
Writing on Truth Social, Trump said the order, which he plans to sign Monday morning, would implement a “most favored nation” policy, meaning the US would pay no more than the country that pays the lowest global price for a given drug.
Currently, the US pays significantly more for prescription medications than other developed countries, often nearly triple. Trump, who has long criticised this disparity, did not provide details on how the policy would be enacted but promised it would “bring fairness to America” and force prices to rise globally in order to equalize with US levels.
According to four industry lobbyists, drugmakers have been anticipating such an executive order, which is expected to target more drugs than those covered under President Joe Biden’s Inflation Reduction Act. That legislation enabled Medicare to negotiate prices for 10 drugs, with implementation set for next year and more drugs scheduled for negotiation later.
Alex Schriver, spokesperson for the Pharmaceutical Research and Manufacturers of America, criticised the move, saying, “Government price setting in any form is bad for American patients.”
This isn’t Trump’s first attempt to introduce international reference pricing. A similar initiative during his first term was blocked in court, though it was estimated to save over $85 billion over seven years by reducing a portion of the over $400 billion the US spends annually on prescription drugs.
With inputs from Reuters