From deal to disaster: Drugmakers face a changed Washington as Trump embraces most favored nation prices

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From Deal to Disaster:
Washington Shifts as Trump Revives Most Favored Nation Drug Pricing

The Trump administration is revisiting the "Most Favored Nation" (MFN) policy, which aims to lower US drug prices by pegging what the federal government pays for certain medications to the lower prices paid by consumers in high-income countries1 2.
MFN pricing primarily targets drugs covered under Medicare Part B (administered in a doctor's office) and may now be considered for Medicaid, despite Medicaid already receiving steep discounts compared to the commercial market1.
The United States currently pays up to three times more for prescription drugs than many other countries, largely due to its fragmented, non-single-payer system1 2.
Drugmakers are warning that MFN pricing could significantly impact their revenues, as about 70% of global pharmaceutical profits come from the US market; companies like Bristol Myers Squibb, Amgen, Pfizer, and Gilead have the highest exposure to this policy2 5.

- There are major criticisms of the MFN policy:

It can be manipulated, as overseas prices can be hidden behind confidential rebates, making it hard to ensure true price parity5.
The global pharmaceutical market's economics suggest that if forced to lower US prices, companies might abandon less profitable overseas markets, potentially harming innovation and ultimately not delivering the intended savings to US consumers5.
- Pharmaceutical executives and European leaders are expressing concern that price controls could stifle innovation and investment, even as US policymakers push for international price referencing to reduce costs at home2.
- The revived MFN initiative signals a more aggressive US policy stance, reflecting growing public and political impatience with high drug prices and a willingness to adopt controversial solutions1 5.