Trump's Bold Drug Price Overhaul - Most Favored Nation Policy

December 27, 2025

In a seismic shift for American healthcare, President Donald Trump's revived Most Favored Nation (MFN) policy is slashing prescription drug prices by tying them to the lowest rates in other developed countries, promising billions in savings for patients and taxpayers. But as the administration secures landmark deals with major pharmaceutical giants, critics point to a history of Democratic resistance—often linked to hefty industry donations—that has long shielded Big Pharma's sky-high profits. This clash highlights a deepening partisan divide over who really pays for America's drug innovation.

The MFN policy, first floated during Trump's initial term and relaunched with vigor in 2025, targets what the White House calls "global freeloading," where U.S. consumers foot the bill for pharmaceutical R&D that benefits the world. An Executive Order signed on May 12, 2025, kickstarted the process, instructing federal agencies to notify drug manufacturers of MFN price targets within 30 days and explore tools like direct-to-consumer sales, antitrust actions, and Medicare payment reforms. By July 31st, letters were dispatched to pharma companies, paving the way for voluntary agreements that began rolling out on September 30th.

Implementation:

Driving this implementation within the Department of Health and Human Services (HHS) are key figures including HHS Secretary Robert F. Kennedy, Jr., who oversees the broad strategy and has coordinated international deals like the December 1 framework with the United Kingdom to adjust global pricing. Working closely with him is Centers for Medicare & Medicaid Services (CMS) Administrator Dr. Mehmet Oz, responsible for operationalizing models such as the voluntary Medicaid GENEROUS Model, which pegs prices to adjusted international rates. Supporting roles include CMS's Medicare Director Chris Klomp, who integrates MFN into Medicare programs through reforms like enhanced price transparency, and Assistant Secretary for Technology Policy Tom Keane, MD, who advances health IT tools for real-time pricing data. These leaders have navigated staff reductions at HHS while prioritizing the policy's expansion.

The administration has inked deals with 14 leading manufacturers, including a fresh batch announced on December 19th: Amgen, Bristol Myers Squibb, Boehringer Ingelheim, Genentech (Roche's U.S. arm), Gilead Sciences, GSK, Merck, Novartis, and Sanofi.* These pacts cover treatments for diabetes, arthritis, multiple sclerosis, asthma, COPD, hepatitis, HIV, cancer, migraines, and heart disease, enforcing MFN pricing in state Medicaid programs. The deals go beyond rebates: Companies are committing to deep discounts via the TrumpRx direct-sales program, repatriating foreign revenues for U.S. patient aid, and pouring over $150 billion into domestic R&D and manufacturing—highlighted by Merck's $70 billion pledge. Some are even donating drug ingredients to national stockpiles, like Bristol Myers Squibb's six-ton contribution of Eliquis.

President Trump says his trade policies and threats of tariffs created the leverage necessary to complete the negotiations. (Reported by The Epoch Times).  The impacts are already rippling through the market. Projections show billions in Medicaid savings and dramatic out-of-pocket reductions, with average cuts of 70% off list prices. Real-world examples include Sanofi's Plavix plummeting from $756 to $16 per month, Gilead's Epclusa hepatitis C treatment dropping from $24,920 to $2,425 per course, and Merck's Januvia diabetes drug falling from $330 to $100 monthly. Broader effects could lower overall healthcare costs, reshape global pricing (potentially raising costs abroad), and spur U.S. investments—though skeptics warn of operational disruptions, access barriers, or stifled innovation. Stock prices for participating companies climbed 1-3% after the announcements, signaling relief from tariff fears.

Americans are starting to feel the relief now: Price drops for Medicaid and TrumpRx purchases kicked in immediately with the December 19th deals, building on earlier September rollouts. New drugs must match pricing across wealthy nations right away, while fuller Medicare changes could arrive in 2026 upon rule finalization. 

TrumpRx.gov is an official U.S. government website (launched and set to be fully operational around January 2026) designed to help Americans access lower prescription drug prices as part of the Trump administration's "Most-Favored-Nation" pricing initiative.

Its primary purpose is to serve as a centralized portal that connects patients directly to discounted prices offered by participating pharmaceutical manufacturers, bypassing traditional insurance middlemen (like pharmacy benefit managers) and their associated markups. It does not sell medications itself but redirects users to manufacturers' direct-to-consumer platforms for purchase.

This initiative stems from executive actions and voluntary agreements starting in 2025, aimed at increasing transparency and affordability, particularly for brand-name drugs. While praised by the administration for delivering "massive savings," critics note it may have limited impact for insured patients (as purchases typically don't count toward deductibles) and focuses on direct sales rather than broad insurance reforms. For the latest details, visit the official site once fully active.

Democrats Protecting Big Pharma Profits?

Yet, this aggressive push contrasts sharply with Democratic efforts that have, at times, appeared to safeguard pharmaceutical profits. While the party touts successes like the 2022 Inflation Reduction Act (IRA)—which empowered Medicare to negotiate select drug prices, capped insulin at $35 monthly for beneficiaries, and penalized excessive price hikes—internal divisions and industry influence have diluted bolder reforms.

During IRA negotiations, three House Democrats—Reps. Scott Peters (D-CA), Kurt Schrader (D-OR), and Kathleen Rice (D-NY)—blocked a proposal to link Medicare prices to international benchmarks in committee, citing risks to innovation and jobs in biotech-heavy districts. They floated a weaker alternative, limiting negotiations to non-competitive drugs, projected to save far less. These lawmakers raked in nearly $1.5 million in career pharma donations, with Peters topping House recipients in 2022 and Schrader's ex-staffer lobbying for PhRMA amid a multimillion-dollar ad blitz against the bill.

In the Senate, Kyrsten Sinema (D-AZ, now independent) narrowed the IRA's scope by curbing eligible drugs and tweaking taxes, influenced by Arizona's biotech scene and over $120,000 in 2019-2020 pharma PAC funds—plus a $1.2 million ad campaign from an industry-backed group.

Sen. Joe Manchin (D-WV) supported some measures but capped the IRA's size, forcing compromises that limited drug reforms—amid family ties to the industry, including his daughter Heather Bresch's role in Mylan's EpiPen price gouging scandal and $60,750 in related donations.

This pattern underscores Big Pharma's $4.7 billion in lobbying over the past decade, with $171 million spent in 2021 alone during IRA talks. While Democrats received $5.2 million in recent PAC contributions (versus Republicans' $6.6 million), the influence transcends parties, with most lawmakers benefiting from industry cash. Republicans decry Democratic "price-setting" as counterproductive, yet financial disclosures indicate that both sides are receiving money for pharmaceutical / health companies.  These records reveal a system that is ripe for reform.

Conclusion:

As Trump's MFN gains momentum under HHS leadership, the debate intensifies: Will these cuts endure, or will pharma's bipartisan sway prevail? For millions rationing meds, the stakes couldn't be higher.

Footnote:

* 14 drug manufacturers have signed deals with the Trump administration as of December 27, 2025, under the "Most-Favored-Nation" (MFN) pricing initiative to lower U.S. prescription drug prices.

This total comes from voluntary agreements announced since September 2025, following letters sent to 17 major pharmaceutical companies in July 2025. The most recent and largest announcement on December 19, 2025, involved 9 companies:

• Amgen

• Boehringer Ingelheim

• Bristol Myers Squibb

• Genentech (Roche)

• Gilead Sciences

• GSK

• Merck

• Novartis

• Sanofi

These joined 5 earlier deals with:

• AstraZeneca

• Eli Lilly

• EMD Serono

• Novo Nordisk

• Pfizer

Three remaining (AbbVie, Johnson & Johnson, Regeneron) had not signed as of the latest announcements, though some reports noted potential upcoming agreements. These deals include price reductions for Medicaid, direct-to-consumer discounts via TrumpRx.gov, commitments to U.S. manufacturing investments, and (for some) donations to emergency stockpiles, in exchange for tariff relief.

Sources:

The Epoch Times

whitehouse.gov