Trump Sets 60-Day Deadline for Pharma Firms to Cut U.S. Drug Prices

President Donald J. Trump has issued a directive compelling pharmaceutical companies to reduce prescription drug prices in the U.S. to align with international “Most-Favored-Nation” (MFN) rates. In letters sent to the CEOs of 17 major pharmaceutical firms, including Pfizer and Johnson & Johnson, the administration set a 60-day deadline for companies to comply with the new pricing structure or face potential government action. The initiative, outlined in a July 16 letter, requires firms to apply MFN pricing to all Medicaid patients for both existing and newly launched drugs, ensuring that U.S. prices do not exceed those in other developed countries [1].

The directive is part of an executive order signed on May 12, 2025, titled “Delivering Most-Favored-Nation Prescription Drug Pricing to American Patients.” The White House has emphasized that the policy aims to secure the best possible prices for prescription drugs by leveraging global benchmarks, and has warned that the administration will “deploy every tool in our arsenal” if drugmakers fail to comply [2]. This move reflects a broader effort to address the high cost of medications in the U.S., where patients often pay significantly more than their counterparts in other countries.

Pharmaceutical firms are now under significant pressure to respond quickly to the ultimatum. Trump has also indicated that U.S. trade policy could be used to help companies negotiate higher prices abroad, provided they agree to implement MFN pricing domestically. This approach seeks to balance the financial interests of drug manufacturers with the affordability needs of U.S. consumers [4].

The administration has set a final compliance deadline of September 29, with the warning that failure to meet these demands could lead to regulatory or legal interventions. This has already begun to impact the sector, with pharmaceutical stocks experiencing a sharp decline as investors assess the potential implications for company revenues [5].

Industry experts anticipate a swift and potentially contentious response from drugmakers, who have historically resisted price controls. Trump has emphasized that “Americans need lower drug prices” and that global price disparities are no longer acceptable. This move aligns with a long-standing campaign to reform the U.S. drug pricing system, which has drawn widespread public and political attention [6].

Public reaction to the announcement has been muted, with no official statements released by the pharmaceutical companies involved. The lack of response highlights the companies’ caution in addressing policy shifts, as they assess their options for compliance or resistance.

While the directive has caused market volatility, it has not yet had a direct impact on major cryptocurrencies, as previously observed with similar regulatory announcements. Analysts suggest that the order could lead to significant changes in pharmaceutical pricing structures, potentially affecting global market dynamics.

Source:

[1] Trump gives major drugmakers 60 days to cut U.S. prices (https://www.axios.com/2025/07/31/trump-us-drug-prices-deadline)

[2] White House threatens to 'deploy every tool in our arsenal' (https://www.fiercepharma.com/pharma/white-house-threatens-deploy-every-tool-our-arsenal-if-drugmakers-dont-adopt-most-favored)

[4] Trump Demands Drug Companies Slash US Prices in (https://www.bloomberg.com/news/articles/2025-07-31/trump-demands-pharma-companies-slash-us-drug-prices-in-letter)

[5] 'Americans need lower drug prices'; sets 29 September (https://timesofindia.indiatimes.com/business/international-business/donald-trumps-crackdown-at-pharma-americans-need-lower-drug-prices-sets-29-september-deadline-or-face-action/articleshow/123032580.cms)

[6] Trump sends letters to pharma CEOs demanding they (https://finance.yahoo.com/news/trump-sends-letters-to-pharma-ceos-demanding-they-reduce-drug-prices-in-60-days-194010685.html)