White House Threatens Most Favored Nation Plan to Lower US Drug Prices, but Many Questions Remain
On May 13, 2025, the White House announced a sweeping executive order to implement a 'most favored nation' (MFN) policy on drug prices, aiming to align US prescription drug prices with those paid in other developed nations124.
The executive order directs the Secretary of Health and Human Services to set targets for price reductions within 30 days and, if voluntary compliance fails, to propose regulations to enforce MFN pricing124.
This policy revives and expands upon a similar rule proposed during President Trump's first term, which had faced criticism and legal challenges234.
The plan covers not only Medicare but also extends into private markets and leverages federal powers such as patent enforcement and potential drug importation to pressure drugmakers2.
The policy's legal authority, feasibility, and precise implementation remain uncertain, with many open questions about how the administration will enforce MFN pricing and its potential impact on pharmaceutical innovation and market dynamics24.
The administration claims the MFN policy could cut US drug prices by as much as 59%, tying prices to the lowest found globally4.
Industry and policy experts caution that while the plan is ambitious, it leaves unresolved how to navigate international price differences, industry pushback, and possible unintended consequences for drug development and patient access24.
Sources:
1. https://www.aha.org/news/headline/2025-05-12-white-house-announces-executive-order-establishing-most-favored-nation-drug-pricing
2. https://www.biospace.com/policy/white-house-unwraps-massive-drug-pricing-policy-touching-all-corners-of-pharma
3. https://endpts.com/white-house-threatens-most-favored-nation-plan-to-lower-us-commercial-drug-prices/
4. https://www.politico.com/news/2025/05/12/trump-pledges-to-revive-most-favored-nation-drug-pricing-00341622