An analysis of how Trump’s latest executive order will affect US drug pricing

The Trump Administration released a new executive order yesterday to lower US drug pricing. The policy takes a most favored nations (MFN) approach to pricing, requiring drug manufacturers to offer Medicare their products at the same prices they do in other countries. Therefore, it seems likely that international reference pricing (IRP) may be a discussion point for the days to come.

MME’s most recent analysis investigated the implications of using IRP from two prior proposals; we have now revised that analysis to assess the potential global pricing impact for the MFN approach for 10 leading #Medicare Part B drugs.

Based on the MFN approach, overall expected price declines would be (on average) -68% (range -54% to -88%).

This price decline of -68% does not account for country GDP differences, nor does it look at net prices where published, such as Germany; however, we expect including these additional variables will push price declines even further. If enacted, the implications would be substantial both within and outside the US.

Please stay tuned—MME has planned an advisory board with EU payers in September to discuss this topic further. We would be happy to schedule a meeting to talk through this analysis and how it might translate into actionable preparation strategies for your product(s).

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