Trump signing executive order to reduce prescription drug costs
Photo I State House News Service
President Donald Trump announced an executive order that he said would immediately reduce prescription drug prices at the White House on Monday.
President Donald Trump is signing an executive order Monday morning that he says will reduce prescription drug prices by 30% to 80% "almost immediately," though White House officials described a more involved process.
"For many years the World has wondered why Prescription Drugs and Pharmaceuticals in the United States States of America were SO MUCH HIGHER IN PRICE THAN THEY WERE IN ANY OTHER NATION, SOMETIMES BEING FIVE TO TEN TIMES MORE EXPENSIVE THAN THE SAME DRUG, MANUFACTURED IN THE EXACT SAME LABORATORY OR PLANT, BY THE SAME COMPANY??? It was always difficult to explain and very embarrassing because, in fact, there was no correct or rightful answer," Trump wrote in a social media post Sunday night.
The president said he would be signing a "MOST FAVORED NATION’S POLICY whereby the United States will pay the same price as the Nation that pays the lowest price anywhere in the World."
Policy analysts have flagged prescription drug costs and utilization as a driver of health care cost increases.
White House officials said the United States accounts for 5% of the world's population but about 75% of the world's pharmaceutical profits. They said the idea behind Trump's order is that American patients and taxpayers have been footing the bill for global research and development by paying higher prices for prescription drugs, and that drug companies should give the U.S. prices at least as favorable as what they charge from health systems in other countries.
"Our Country will finally be treated fairly, and our citizens Healthcare Costs will be reduced by numbers never even thought of before. Additionally, on top of everything else, the United States will save TRILLIONS OF DOLLARS," the president posted.
White House officials told reporters Monday that the executive actions will unfold along a few fronts.
First, the U.S. Trade Representative and the U.S. Department of Commerce will be directed to take all appropriate action against unreasonable and discriminatory policies in foreign countries that suppress drug prices abroad. U.S. Health and Human Services Secretary Robert Kennedy, who was scheduled to join Trump for a Monday morning event on the order, will be directed to facilitate direct-to-consumer sales at "most-favored-nation" prices for drugs deemed appropriate, and within 30 days Kennedy must set nonbinding targets for prescription drug price reductions across all markets of the U.S., White House officials said.
The officials said those actions are expected to lead to a round of negotiations between Kennedy's HHS and the pharmaceutical industry. The White House said Kennedy will look to take regulatory action if the progress of those pricing negotiations is not considered adequate to Trump.
After Monday morning's press conference with Kennedy, Trump was to jet off to Riyadh where his schedule includes a state visit at the Royal Court in Saudi Arabia, a "Saudi-U.S. Investment Forum," and state dinner Tuesday.
The Center for Health Information and Analysis reported in March that health care spending in Massachusetts grew at an 8.6% rate from 2022 to 2023, more than twice the 3.6% benchmark. CHIA researchers dubbed the 2023 growth rate "unsustainable" as they pointed to increased pharmacy spending as one of the the major drivers.
Pharmacy spending increased $1 billion or 10% year over year (net of rebates) from 2022 to 2023. The Legislature and Gov. Maura Healey late last year enacted a pair of new health policy laws, including one aimed at reining in prescription drug costs.
House Speaker Ronald Mariano said in March that the House plans to revisit some of its initiatives that didn't make it into last year's pharmaceutical law, including requiring insurance companies to count any assistance a consumer receives towards their out-of-pocket spend; making permanent the ability of consumers to use drug manufacturer coupons to pay for prescriptions; and ensuring that pharmacy benefit managers pass through at least 80% of the discounts they negotiate directly to consumers.
"We wanted to include, and we will include, we're coming back to work on this," he said.
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