May 12, 2025
President Donald J. Trump signed an executive order today aiming to significantly reduce prescription drug prices in the United States. The order introduces a “Most Favored Nation” (MFN) policy, mandating that the U.S. pay no more for certain medications than the lowest price paid by other developed countries. Trump asserts this move could decrease drug costs by 30% to 80% .
“Our Country will finally be treated fairly, and our citizens’ Healthcare Costs will be reduced by numbers never even thought of before,” Trump stated on Truth Social.
The executive order directs the Department of Health and Human Services to tie Medicare payments for drugs administered in clinical settings, such as cancer infusions under Medicare Part B, to the lowest prices paid internationally . This policy revives a similar initiative from Trump’s first term, which was blocked by a federal judge and later rescinded by the Biden administration.
The pharmaceutical industry has expressed strong opposition, arguing that government-imposed price controls could hinder innovation and patient access to new treatments. Following the announcement, shares of major pharmaceutical companies, including AbbVie, AstraZeneca, and Eli Lilly, experienced declines .
While the executive order’s full impact will depend on its implementation and potential legal challenges, it represents a significant effort by the Trump administration to address the high cost of prescription drugs in the United States.
