Donald Trump has revealed a new plan to sharply reduce the cost of prescription drugs in the United States.
The move comes through an executive order that aims to bring prices down by matching what other rich countries pay for the same medications. With Americans often paying far more than people in Europe or Canada, the announcement has drawn both support and criticism.
The announcement was made over the weekend, with the signing expected on Monday. Trump’s latest order focuses on Medicare, the government health program for seniors. The rule will affect drugs given in doctors’ offices and clinics under Medicare Part B. The idea is to force drugmakers to offer the U.S. government prices no higher than what they charge in other developed countries. The president made this known through a post on his Truth Social platform, outlining his intention to stop Americans from paying the highest prices in the world for the same medications.
The main push behind the plan is the large price gap between the United States and other wealthy nations. Americans often pay up to ten times more for the exact same drugs, made by the same companies, in the same factories. Trump’s order, called the Most Favored Nation policy, is aimed at ending this pattern by tying U.S. drug costs to the lowest global prices. The plan is based on existing economic partnerships with countries in the Organization for Economic Co-operation and Development that have similar income levels.
The president is targeting the pharmaceutical industry’s pricing power, which has long been blamed for making essential medicines too expensive for many Americans. While Trump has spoken about this issue before, a similar effort during his first term was blocked in court. This time, the new version of the plan includes changes such as adjusting for differences in income levels between countries and the volume of drugs purchased. This is meant to make the pricing comparisons more realistic.
Drug companies and policy critics are not pleased. Some argue that forcing companies to cut prices in the U.S. could lead them to limit supply or raise prices elsewhere to make up the difference. Others say the plan may not work as intended, since many foreign drug prices are hidden through secret rebate deals. There is also concern that drugmakers might reduce the availability of certain medicines if they are forced to sell at lower prices. Legal challenges are likely, as the policy could once again be challenged in court, just like it was in 2021.
Trump’s plan stands in contrast to the approach taken by the Biden administration. Under the Inflation Reduction Act, Medicare was given the power to negotiate the prices of some expensive drugs. That program is being rolled out slowly, beginning with 10 drugs that account for a large portion of Medicare spending. The negotiated prices under that plan will not take effect until 2026. Trump’s method, by comparison, is designed to create immediate price cuts across a wider range of medications.
The impact of the plan will depend on how it is enforced and whether it survives legal scrutiny. If it works, the White House believes the move could save billions for both the government and people who rely on Medicare. Trump’s order also reflects his campaign message that Americans should stop being overcharged for healthcare. The issue of drug pricing could become a major talking point, especially among older voters who depend on Medicare for their medicine.
If implemented successfully, this policy could be one of the largest efforts yet to cut healthcare costs in the United States. But with powerful pharmaceutical companies and legal hurdles standing in the way, it remains to be seen whether Trump’s ambitious move will reshape drug pricing or end up blocked again.