Trump's New Executive Order Targets High Drug Prices
President Donald Trump signed an executive order to implement ‘most favored nations drug pricing’, aiming to drastically reduce prescription drug costs for Americans.
In a bold move against pharmaceutical industry practices, President Donald Trump signed an executive order on Monday, introducing a ‘most favored nations drug pricing’ policy. This policy is designed to align American drug prices with the lowest prices available in other developed countries, potentially slashing costs by up to 90%. Trump criticized the pharmaceutical industry for profiteering and price gouging, stating that the U.S. will no longer subsidize foreign healthcare by paying exorbitantly higher prices for the same medications.
The executive order mandates the U.S. Trade Representative and the Secretary of Commerce to counteract foreign practices that undercut market prices in the U.S. Additionally, it directs the Secretary of Health and Human Services to establish a direct purchasing mechanism for Americans to buy drugs at ‘Most-Favored-Nation’ prices from manufacturers, bypassing intermediaries. If manufacturers do not comply, the order empowers the Secretary to propose rules enforcing these prices and to take further steps to reduce costs and combat anticompetitive practices.
Trump emphasized that despite the U.S. hosting only 4% of the world’s population, it accounts for over two-thirds of pharmaceutical profits, a situation he deems unfair. The move has received mixed reactions; while some applaud the potential relief for American consumers, the Pharmaceutical Research and Manufacturers of America have expressed concerns, arguing that the policy could harm Medicare funding and increase reliance on foreign, particularly Chinese, pharmaceuticals.
Health and Human Services Secretary Robert F. Kennedy Jr. expressed his surprise and support for the initiative, highlighting its potential impact on ordinary Americans, including his own children who are fans of more progressive policies.