A New Plan to Lower Drug Prices: Will It Work?

The United States has long struggled with high drug prices, which are often two to three times higher than in other developed countries. This is why President Trump recently revived a policy aimed at reducing these costs. This policy, known as the "most favored nation" approach, ties the prices the U. S. government pays for certain medicines to the lower prices paid abroad. This could lead to significant savings for patients, with price cuts potentially ranging from 59% to 90%. The policy focuses on drugs with the biggest price differences and spending, including popular treatments for weight loss and diabetes. However, the administration has not specified which medications will be affected. This time around, the policy is broader than a previous attempt during Trump's first term, which only applied to Medicare Part B drugs. The goal is to equalize drug prices, ensuring that the U. S. pays the lowest prices available globally. Trump signed an executive order outlining several actions to implement this policy. One key aspect is targeting foreign countries that have more power to negotiate lower drug prices. These countries often have universal health coverage, giving them significant leverage in price negotiations. The order also directs various agencies to address unfair pricing practices abroad and to encourage drugmakers to offer discounts across the board. The Food and Drug Administration may even expand drug imports from other developed nations beyond Canada. The Department of Justice and Federal Trade Commission will also crack down on anti-competitive actions that keep drug prices high in the U. S. The pharmaceutical industry is not happy with this plan. They argue that it could hurt their profits and ability to innovate. However, White House officials believe that drugmakers will still make money if they increase prices abroad and realize that the U. S. won't be the sole funder of their innovation. It's unclear how effective this policy will be in lowering costs for patients. Previous attempts have faced legal challenges and opposition from the industry. The success of this new effort remains to be seen. One thing is certain: the fight to make medications more affordable is far from over.