On May 12, 2025, President Donald Trump signed a sweeping executive order aimed at significantly reducing prescription drug prices in the United States. The directive mandates that pharmaceutical companies align U.S. drug prices with the lowest prices paid by economically comparable nations, a strategy known as “most-favored-nation” pricing.
The executive order sets a 30-day deadline for drug manufacturers to voluntarily lower their prices. If they fail to comply, the administration may implement regulatory actions, including the introduction of new pricing rules and potential revocation of drug approvals.
President Trump criticized the pharmaceutical industry for what he described as “profiteering,” noting that Americans often pay significantly more for medications than patients in other developed countries. He emphasized that the U.S. government, as a major purchaser of pharmaceuticals, should leverage its buying power to negotiate better prices for American consumers.
The order also instructs the Department of Health and Human Services to facilitate direct-to-consumer purchasing programs, allowing American patients to buy medications at the most-favored-nation price, bypassing intermediaries such as pharmacy benefit managers.
The pharmaceutical industry has expressed concerns over the executive order, arguing that such measures could hinder innovation and lead to reduced investment in research and development. However, supporters of the policy argue that it will alleviate the financial burden on American patients and taxpayers.
This initiative marks a significant step in the Trump administration’s efforts to reform drug pricing and reduce healthcare costs for Americans.
