The FDA's New Playbook: How Drug Pricing Power is Shifting in 2025

The FDA's new Commissioner's National Priority Voucher (CNPV) program is rewriting the rules of the game for Big Pharma. By tying accelerated drug approvals to therapies aligned with U.S. national priorities—and indirectly linking them to global pricing benchmarks—this initiative is creating a seismic shift in how drugmakers price their products. Investors, take note: The era of unchecked U.S. pricing power is over. Let's unpack why this matters and which drugmakers are positioned to win—or lose—in this new landscape.

The Structural Shift: NPVs, MFN, and Pricing Pressure

The CNPV program fast-tracks approvals for drugs addressing health crises, rare diseases, or boosting domestic manufacturing—a clear nod to national security and public health priorities. But here's the catch: While the program doesn't explicitly require price alignment with international markets, it operates in tandem with the Trump administration's Most-Favored-Nation (MFN) policy. This policy aims to index U.S. drug prices to those in 14 developed nations, effectively capping Medicare prices at the lowest global rate.

The result? A two-pronged pressure on drugmakers:
1. Accelerate approvals via CNPV to meet U.S. priorities.
2. Align prices with global benchmarks to qualify for such incentives or avoid MFN penalties.

This is a game-changer. Companies with therapies that don't fit these priorities—or that rely on high U.S. prices—will face margin compression. Those with diversified pipelines, international revenue streams, or treatments in high-demand therapeutic areas (e.g., rare diseases, oncology) can retain pricing leverage.

Breaking Down the Winners and Losers: PFE, MRK, BMY

Pfizer (PFE): The Regulatory Insider with Risks

• Strengths: Pfizer's leadership includes Dr. Patricia Cavazzoni, a former FDA CDER chief. This gives them an edge in navigating the CNPV's accelerated review process. Their maternal RSV vaccine pipeline aligns with public health priorities, potentially securing fast-track status.
• Weakness: Over 40% of Pfizer's revenue comes from the U.S., making it vulnerable to MFN-driven price cuts. Its blockbuster drugs like Paxlovid (now facing generic competition) and cholesterol meds face declining U.S. pricing power.
• Investment Take: Buy if you believe Pfizer can diversify its pipeline and expand into high-margin markets like rare diseases. But beware—its heavy U.S. exposure is a red flag.

Merck (MRK): The CNPV Play with Strong Efficacy

• Strengths: Merck's clesrovimab (RSV prevention) just secured FDA approval with 84% efficacy in reducing hospitalizations. This therapy fits squarely into CNPV's “health crises” priority, giving Merck a clear path to accelerated reviews. Its global manufacturing footprint (e.g., U.S. and EU facilities) also buffers against MFN pressures.
• Weakness: Over 30% of revenue still comes from the U.S., and its reliance on older drugs like Keytruda (facing biosimilar threats) could strain margins.
• Investment Take: A solid hold. Merck's R&D focus on infectious diseases and oncology gives it CNPV-friendly pipelines, but monitor its U.S. pricing strategy.

Bristol-Myers Squibb (BMY): The Pipeline Gambler

• Strengths: BMY's acquisition of 2seventy bio ($286M) expands its R&D into novel therapies like antibody-drug conjugates and RNA treatments. These align with CNPV's “innovative cures” criteria. Its focus on rare diseases (e.g., Friedreich's ataxia) and oncology also fits high-priority areas.
• Weakness: With ~45% of revenue in the U.S., BMY is exposed to MFN-driven price caps. Its legacy drugs (e.g., Revlimid) face generic competition, squeezing margins.
• Investment Take: A speculative buy. BMY's pipeline diversity is promising, but its heavy U.S. reliance and reliance on legacy products make it risky.

The Bottom Line: Re-Evaluate Valuations Based on Geographic Exposure and Pipeline Diversity

Investors must ask two questions:
1. How much revenue is tied to the U.S.? Companies with >40% U.S. exposure (like PFE and BMY) face greater margin compression risks.
2. Is the pipeline CNPV-friendly? Therapies in rare diseases, oncology, or infectious diseases (like MRK's RSV drug) can secure fast-track status, preserving pricing power.

Action Items:
- Buy MRK: Strong CNPV-aligned pipeline, global diversification, and proven efficacy data.
- Avoid PFE: Overexposed to U.S. pricing risks without enough high-margin pipeline wins.
- Hold BMY: Potential upside from R&D bets, but wait for clearer signs of pipeline execution.

The FDA's new playbook is here to stay. Those who adapt fastest to global pricing realities—and bet on therapies that matter most to regulators—will outlast the margin-squeeze storm. The rest? They're just playing with fire.

As of July 2025, data sources include FDA announcements, company earnings reports, and third-party analyses.