Trump’s Most-Favored-Nation Policy Aims to Lower US Healthcare Costs
TL/DR –
The U.S. Department of Health and Human Services (HHS) is implementing President Trump’s Executive Order to apply Most-Favored-Nation Prescription Drug Pricing for American patients. This forms part of a strategy to align the costs of medication in the U.S. with those of other economically comparable countries. The HHS expects pharmaceutical manufacturers to ensure U.S. pricing for brand products aligns with the lowest price in an OECD country, with a GDP per capita of at least 60 percent of the U.S. GDP per capita, for all markets that lack generic or biosimilar competition.
Most-Favored-Nation Executive Order for Affordable Health Care in the US
The US Department of Health and Human Services (HHS) has announced the immediate implementation of President Trump’s Executive Order “Delivering Most-Favored-Nation Prescription Drug Pricing to American Patients”. This initiative forms a key part of the Administration’s strategy to make healthcare more affordable in the US.
Setting Targets for Pharmaceutical Manufacturers
Under the guidance of President Trump, HHS Secretary Robert F. Kennedy Jr., and CMS Administrator Dr. Mehmet Oz, specific targets for pharmaceutical manufacturers have been identified. These targets aim to meet the requirements of the Executive Order to ensure affordable medication for Americans. In the coming weeks, the Administration will be highlighting their commitments to this cause.
Addressing High Drug Prices in the US
Secretary Kennedy stated, “Americans have been unjustly burdened with high drug prices compared to overseas markets. Today marks the end of this disparity. We expect pharmaceutical manufacturers to lower prices for American patients, and we will ensure they do.”
Aligning US Pricing with International Market Rates
The HHS expects manufacturers to align US pricing for branded products across all markets that lack generic or biosimilar competition, with the lowest price of a set of economic peer countries. The Most-Favored-Nation (MFN) target price will be the lowest price from an Organisation for Economic Co-operation and Development (OECD) country with a GDP per capita of at least 60% of the US’s. The initiative aims to significantly reduce US drug prices, which are often three to five times higher than prices abroad, while preserving innovation.
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