President Donald Trump has found himself in an odd juxtaposition as traditional allies are pushing back on his Most Favored Nation (MFN) plan to reduce the price of prescription drugs.
In a letter to Congress, more than 50 leaders of free-market and conservative organizations have urged (PDF) lawmakers to reject Trump’s MFN policy, saying it would “import socialist price controls and values into our country.”
The letter comes after Trump's “Great Healthcare Plan,” unveiled last month, called on lawmakers to codify MFN policies. As it stands, the MFN policy has been shaped through an executive order and a series of confidential deals with drugmakers.
Dubbing themselves the Coalition Opposing the Codification of Most-Favored-Nation Prescription Drug Pricing, the group includes leaders from the National Taxpayers Union, the International Technology & Innovation Foundation, the Competitive Enterprise Institute, the Center for a Free Economy and the American Consumer Institute.
“In addition to doing nothing to address foreign freeloading, MFN would reduce access to new cures and reduce U.S. global competitiveness, ceding ground to China,” the coalition wrote. “While supporters of this proposal correctly identify the unique problems facing the American health care system … MFN would not solve these problems. In fact, it would exacerbate them.”
In May of last year, Trump signed an executive order that introduced his MFN plan, saying it would cut the price of drugs in the U.S. by up to 90%. The policy aims to tie drug prices paid by the U.S. government to the lowest prices paid by other economically advanced countries.
According to the order, companies had 180 days to negotiate with the Department of Health and Human Services (HHS) before the agency would impose MFN pricing. So far, 16 companies have made deals with the administration to avoid the mandated pricing regime.
“I don’t think the Trump administration believes that there is a deal in Congress to be had,” John Barkett, a former senior policy advisor in the Biden administration and now a Managing Director at global consulting firm BRG, said in an interview. “Rather than go to Congress and changing the laws, he’s trying to bring every tool that is at the federal government’s disposal to bear in trying to bring prices down however they can.”
Among the tools Trump is employing are incentivizing lower Medicaid prices and offering companies to sell some drugs in a government direct-to-consumer online program, TrumpRx.gov, for patients paying with cash. In exchange, the president has granted tariff relief to drugmakers that cut the price of some drugs and to those who agree to invest in R&D and manufacturing facilities in the U.S.
Because the agreements are confidential, there have been few specifics from the government or the companies about how they will impact drug prices. But some companies, like Novo Nordisk, have flagged the MFN policy as a headwind for their expected 2026 financial performance.
In its effort to evaluate the impact of the deals, consumer advocacy organization Public Citizen has filed (PDF) a Freedom of Information Act (FOIA) lawsuit against the HHS and the Department of Commerce for failing to provide documents related to Trump’s MFN negotiations.
The nonprofit filed the complaint after it made unsuccessful attempts to acquire copies of MFN agreements made between the government agencies and pharmaceutical giants Eli Lilly and Pfizer, more than three months ago.
“I think it would be helpful for all parties to reveal what the deals actually say,” Barkett said. “In the Oval Office, the administration leaders have gotten up there and said, ‘this is the biggest drug pricing policy deal to ever happen.’ That’s an odd thing to say when you’re not willing to reveal the details of it.”
To Barkett, the lack of transparency raises questions: Do the agreements include all the drugs in each of the manufacturers’ portfolios? Will MFN negotiated prices be any different from the prices paid by Medicaid, which are already lower than in other segments of the healthcare system? Will the negotiated prices have any impact for those covered by Medicare or commercial insurance?
Barkett, who helped formulate industry-related policies in Biden’s Inflation Reduction Act (IRA), recognizes why Trump is intent on reducing the price of drugs, even if it ruffles the feathers of those on his side of the aisle.
“When polling outfits poll on the issue of drug prices, it is as bipartisan [a] consensus as it gets on any political issue, which is that people want lower drug prices,” Barkett said. “If you see President Trump doing something that is not particularly conservative, it’s because he’s reading the same polls the Democrats are.”