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Date: 12-may-2025 | By: Nuztrend Team
Former U.S. President Donald Trump announced the revival of a controversial executive order aimed at reducing prescription drug prices in the United States. Dubbed the “Most Favored Nation” (MFN) policy, the order ties Medicare drug pricing to the lowest rates paid by other developed nations, potentially triggering cuts between 30% and 80% on certain medications.
The announcement immediately rattled pharmaceutical markets. Stocks of major U.S. drugmakers—such as Johnson & Johnson, Merck, Eli Lilly, and AbbVie—fell sharply during early Monday trading. International markets, particularly in Japan and China, also saw significant declines in pharmaceutical stocks due to fears of global price pressures.
The MFN policy is not new. Trump initially introduced it in 2020 during his first term, but the measure was blocked by a federal judge and later rescinded by the Biden administration. Its reintroduction in 2025 signals Trump’s continued focus on drug price reform as part of his political campaign and economic agenda.
While supporters argue this could bring billions in savings for American taxpayers and reduce out-of-pocket costs for seniors, critics warn of unintended consequences like reduced access or slower innovation in the biotech sector.
Pharmaceutical lobby groups, including PhRMA (Pharmaceutical Research and Manufacturers of America), condemned the move, calling it “dangerous,” “legally dubious,” and a threat to future drug development. Analysts suggest a wave of lawsuits may follow, just as in 2020.
In a statement, PhRMA warned, “Pegging U.S. prices to foreign systems that ration care undermines innovation and patient access.”
Trump's latest order has sparked divided responses across the political spectrum. While progressive leaders and consumer advocacy groups welcomed the cost-cutting intent, others questioned the timing and potential election motives behind the policy shift.
For millions of Americans struggling with high drug prices, however, the move could offer relief—if implemented swiftly and successfully.
The order will go into effect in phases, starting with a list of 50 high-cost drugs. CMS is expected to release further guidance within the next 60 days. Meanwhile, Wall Street, healthcare providers, and global drugmakers are bracing for ripple effects across the pharmaceutical supply chain.
Whether this policy will survive legal and legislative challenges remains to be seen, but its economic and political impact is already making waves in the U.S. and beyond.
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Date: 12-May-2025
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Date: 12-May-2025
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