Earlier this month, a top Republican pollster advised President Trump to promote his “affordability” bonafides — under attack by Democrats — by leaning into his efforts to lower prescription drug prices.
On Friday, the White House may have taken the tip. It announced deals with nine global pharmaceutical manufacturers, far more than in similar press conferences over the last several months.
“This represents the greatest victory for patient affordability in the history of American health care, by far,” Trump said at a press conference.
The deals, which have been in the works for the past few months, bring to 14 the total of major drugmakers that have volunteered to lower drug prices and bring more manufacturing to the U.S. They are among the 17 Trump sent letters to in July, demanding that they voluntarily lower U.S. prices for some of their drugs to match what they charge affluent foreign nations, known as most-favored nations prices. The deadline to comply was Sept. 29
Previous announcements were rolled out piecemeal, but the blast Friday marks the administration’s most sweeping expansion of a strategy it contends will reshape how Americans and other nations pay for medicines.
The announcement comes about two weeks after top GOP pollster Fabrizio Ward urged Republicans on Capitol Hill to hone in on drug pricing affordability amid a contentious debate over the future of the Affordable Care Act’s expiring tax credits. Congress was unable to pass a deal to prevent the subsidies from expiring Dec. 31 and insurance costs are spiking.
The new deals — signed by Amgen, Boehringer Ingelheim, Bristol Myers Squibb, Genentech, Gilead, GSK, Merck, Novartis and Sanofi — generally align with the previous agreements signed with AstraZeneca, Eli Lilly, EMD Serono, Novo Nordisk and Pfizer.
“This is no longer a trickle. This is a flood. And it's gone from a bold policy to an industry standard,” said a senior administration official involved in the deals.
But it is unclear how quickly the new deals will have a tangible impact on out-of-pocket drug costs for most Americans. Many of the deal provisions that aim to stem the price of new drug launches in the U.S. will take years to kick in — and questions remain about the durability of the agreements once Trump leaves office.
The majority of Americans that have private health insurance likely will not immediately benefit from lower prices — in part because the administration’s push to offer drugs direct-to-consumer at a discounted cash price through the soon-to-be-launched TrumpRx website does not currently count towards insurance deductibles.
“The vast majority of consumers are not going to see any benefit in their pocketbook from the MFN deals that have been negotiated,” Raymond James analyst Chris Meekins, who worked as a health official in the first Trump administration, said in an interview before the Friday announcement.
Still, top health officials including Health and Human Services Secretary Robert F. Kennedy Jr. and Centers for Medicare and Medicaid Services Administrator Mehmet Oz echoed Trump, touting the deals as an example of the administration's work to address health care affordability.
“You talk about affordability. People are talking about affordability. Nobody has done anything for affordability greater than this,” Kennedy said. “I want to thank you, President Trump, for your leadership, for your vision and for your relentless harassment of us to make sure this all got done.”
CMS has indicated that under the agreements, the MFN price will be determined by taking the second-lowest price paid for a drug after factoring in discounts and rebates in Canada, Denmark, France, Germany, Italy, Japan, Switzerland and the United Kingdom, adjusted for each country’s income level.
The majority of each drugmaker’s drug portfolio will be offered at a MFN price to Medicaid, but questions remain about which drugs will not be included.
Future drug launches will be offered at an MFN price in the U.S. in commercial, Medicare, Medicaid and the cash pay market, according to the senior administration official. But it is unclear what levers the agreements offer the government to enforce that commitment in the commercial market at that lower price.
“The agreements by these nine manufacturers represent over $150 billion in combined new investment commitments in manufacturing and research and development here in the United States,” the senior administration official told reporters.
In exchange for lowering prices and U.S. manufacturing commitments, the companies will be given relief from potential future tariffs.
TrumpRx.gov is set to launch in January. Drugs that will be listed on the website will generally be drugs that are dispensed in pharmacies, not drugs that are injectable or need an infusion that require a medical provider to be administered, according to a different senior administration official on the reporter call.
A new component of the latest deals is a program aimed at strengthening domestic supply of the ingredients used to manufacture key medicines in emergencies. Several of the nine drugmakers are contributing active pharmaceutical ingredients to a “strategic active pharmaceutical ingredients reserve” that can be manufactured into finished medications and distributed to Americans during emergencies, according to the senior administration official.
“This is the president's answer to pharmaceutical vulnerability, such that when disaster strikes, whether it's a natural catastrophe, pandemic or a national security emergency, America will be ready,” the first senior administration official said.
Earlier this month, the United Kingdom agreed to boost what its National Health Service pays for drugs in exchange for tariff-free access to the U.S. market — an agreement touted by senior administration officials as evidence of the success of Trump’s drug pricing approach. Trump said he expected other countries in Europe will agree to do the same, adding that if they don’t, tariffs will be applied.
The White House Office of Information and Regulatory Affairs this week also concluded review of two regulatory proposals from CMS that drug pricing experts anticipate may impact how the Trump administration plans to enforce its MFN deals.
Trump said more drugmakers will be at the White House next week, including Johnson and Johnson.
Trump also said he wants to convene health insurance companies in Florida or D.C. in the first week of January for a meeting to discuss how to cut insurance costs, describing a thought that occurred to him while listening to the pharmaceutical CEOs talk.
“I'm going to call a meeting of the insurance companies. I'm going to see if they get their price down. To put it very bluntly,” Trump said.
The president has been advocating for Republicans to pass health care legislation that would create health savings accounts for Americans to use toward their out of pocket medical costs, to address the expiring ACA subsidies. Friday’s comments marked a departure from that stance, acknowledged by the president himself.
“There's another way of doing it, and that's getting the insurance companies to ease up and to cut their pricing way, way down, and stay part of the system. So I'm going to call a meeting.”
Cheyenne Haslett contributed to this report.
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