Words by Jade Williams
This morning, US President Donald Trump caused significant shifts in pharmaceutical company stock prices after signing an Executive Order announcing a ‘most-favoured nation’ pricing policy for prescription drugs in the US.
This move, first announced on the President’s platform ‘Truth Social’ on Sunday, aims to link domestic drug prices to the lowest prices paid internationally.
Trump stated on the platform that the Order would ensure the US “pay the same price as the nation that pays the lowest price anywhere in the world”. This was further clarified in a press conference on Monday to mean that US citizens should pay prices comparable to those in other “developed countries”.
According to President Trump, the Executive Order could lead to significant reductions in US drug prices, with claims ranging from 50% to as much as 90%. He also suggested that global drug prices might rise as a result, which he described as a move to “bring fairness to America”. However, these figures are projections and not assured outcomes of the proposal.
Following the announcement on Truth Social, US drugmakers including Eli Lilly, Pfizer, Merck and Bristol-Myers Squibb experienced pre-market losses. European companies such as Sanofi, Novo Nordisk and AstraZeneca also saw declines.
A similar initiative during the US leader’s first term was blocked by a federal court after industry groups challenged the process. The Biden administration chose not to appeal the ruling and instead pursued pricing reform through the Inflation Reduction Act.
Analysts have already warned that this renewed proposal may face multiple legal and regulatory hurdles, especially without supporting legislation. As the US is the world’s largest pharma market, this announcement is likely to provoke a strong response from the industry.
