White House ‘Most Favored Nation’ Deadline Drives Pharma Concessions Amid Threats of Enforcement
On May 12, 2025, President Trump issued an executive order titled 'Delivering Most-Favored-Nation Prescription Drug Pricing to American Patients', aiming to align U.S. prescription drug prices with those of comparably developed nations13.
Following this, on July 31, 2025, the White House sent letters to 17 pharmaceutical manufacturers, outlining demands to reduce drug prices and warning of aggressive action if the companies did not comply within 60 days1234.
The required actions include extending most-favored-nation (MFN) pricing to all Medicaid enrollees, guaranteeing MFN pricing for newly launched drugs across Medicare, Medicaid, and commercial payers via binding contracts, and making low MFN prices available through direct-to-consumer or business models12.
Manufacturers were told to submit binding commitments to these MFN goals by September 29, 2025 (the deadline referenced in the user query)2.
The letters also demanded that pharmaceutical companies repatriate increased revenues from higher foreign prices to lower U.S. drug costs and negotiate harder with foreign nations2.
While the White House threatened to 'deploy every tool in our arsenal' against non-compliance, the administration’s actual legal authority to mandate some of these actions remains unclear12.
Industry response has reportedly been muted, with major concessions and negotiations underway but facing significant operational and legal hurdles1.
The current approach aims for MFN pricing across a wider range of payors and settings—including Medicaid and new drugs—unlike previous proposals, which focused more narrowly on Medicare Part B1.
The administration characterizes high U.S. drug prices as resulting from Americans subsidizing global drug profits and foreign healthcare systems; the push for MFN pricing is part of ongoing efforts to end what the White House calls 'global freeloading' on American pharmaceutical innovation34.
Sources:
1. https://www.mwe.com/insights/federal-actions-signal-mfn-drug-pricing-goal-remains-a-priority/
2. https://www.manatt.com/insights/insight/white-house-announces-new-efforts-on-most-favored-nation-drug-pricing
3. https://www.whitehouse.gov/fact-sheets/2025/07/fact-sheet-president-donald-j-trump-announces-actions-to-get-americans-the-best-prices-in-the-world-for-prescription-drugs/
4. https://ipwatchdog.com/2025/08/04/trump-threatens-pharma-deliver-most-favored-nation-drug-pricing-face-consequences/id=190866/