Trump Unveils Drug Price Cuts with 9 Pharma Giants
US President Donald Trump declared that nine pharmaceutical companies have consented to reduce the prices of their prescription medications in the United States. Pharmaceutical companies Amgen, Bristol Myers Squibb, Boehringer Ingelheim, Genentech, Gilead Sciences, GSK, Merck, Novartis, and Sanofi will now adjust Medicaid drug prices to align with the rates they charge in other developed nations. Under the terms of the agreement, any new drugs developed by these companies will be subject to the most-favoured-nation pricing nationwide for all newly launched medications. This pricing applies to commercial and cash pay markets, as well as Medicare and Medicaid. The cost of medications for patients in the US is influenced by various factors, such as the level of competition among treatments and the specifics of insurance coverage. Many individuals obtain coverage through their employment, the individual insurance market, or government programs such as Medicaid and Medicare, which protect them from a significant portion of the expenses.
Individuals enrolled in Medicaid, currently contribute a small co-payment of a few dollars for their prescriptions. However, reduced prices could provide significant relief to state budgets that finance these programs. Reducing drug prices will also benefit patients without insurance coverage, who often lack the leverage to negotiate more favorable payment terms. However, even with steep discounts of 50 percent available through the administration’s website, patients may still find themselves paying hundreds of dollars each month for certain prescriptions. William Padula stated, “Medicaid already has the most favourable drug rates which in some cases will be close to what the most-favoured-nation price is, so it remains to be seen what other impacts it could have, such as more research and development.” It cannot be bad. “I don’t see much downside but it’s hard to judge what the upside is,” Padula said.
While it is noteworthy that Trump successfully brought major drugmakers to the negotiating table for lower prices, it will require years to assess the effectiveness of this initiative regarding increased access to necessary medications for more individuals. “It’s good for their stock and it’s good for their future research and development,” Padula said of the pharmaceutical companies. It is undoubtedly impactful, but will all of this culminate in a significant outcome? Ultimately, nothing holds significance unless our nation’s health improves. Officials from the Trump administration announced that drugmakers will offer pharmacy-ready medicines on the TrumpRx platform, scheduled to launch in January, enabling individuals to purchase drugs directly from manufacturers. Merck, GSK, and Bristol Myers Squibb have committed to donating substantial supplies of active pharmaceutical ingredients to a national reserve. They will also formulate and distribute these ingredients into medications, including antibiotics, rescue inhalers, and blood thinners, as required during emergencies.
Bristol Myers Squibb has announced that it will provide its signature blood thinner, prescribed to reduce the risk of blood clots and stroke, free of charge to the Medicaid program. Referred to as Eliquis, this medication stands out as the leading prescription from the company and ranks among the most commonly utilized drugs within Medicaid. Padula stated that the donations, which include some of the world’s most essential medicines, represent a crucial advancement toward health equity and a recognition that pharmaceutical companies have the capacity to pursue profits in other areas of their business. Eliquis has already emerged as one of the most profitable drugs ever developed. “It’s a thoughtful health equity move that they can afford given that it’s been such a blockbuster,” Padula said of the Eliquis donation. Other significant pharmaceutical companies such as Pfizer, AstraZeneca, EMD Serono, Novo Nordisk, and Eli Lilly entered into comparable agreements with the Trump administration earlier this year. The administration has successfully negotiated lower drug prices with 14 companies, although specific terms remain undisclosed. This development follows Trump’s public outreach to executives at 17 pharmaceutical companies regarding the matter, highlighting that US prices for brand-name drugs can be as much as three times higher than the averages found in other countries. Trump stated that he effectively threatened the pharmaceutical companies with 10 percent tariffs to compel them to act appropriately.
