The Trump administration may propose a regulatory process to force drugmakers to cut U.S. prices to the lower levels in other wealthy countries, according to a regulatory notice that was briefly posted and then erased from a federal website.
The notice referred to a “proposed rule” and a “global benchmark for efficient drug pricing (GLOBE) model” under the Department of Health and Human Services. It was unclear from the notice exactly what the proposal would do or why it was deleted.
Andrew Nixon, a spokesman for the health department, declined to answer questions, saying the administration does not comment on “potential future regulations.” Reuters earlier reported the notice Thursday.
But President Trump has long called for a model under which U.S. payers would get drug prices equal to the lowest price paid among peer countries. During his first term as president, he spoke about such an approach often. And his Medicare agency started a policy to test the idea in a small category of drugs in 2020, which was later paused by courts and withdrawn by the Biden administration.
If the administration moves forward on a plan to regulate drug prices in this way, it is likely to set off a new round of litigation by pharmaceutical companies, which have fiercely opposed such proposals because they could cut deeply into their profits.
“Importing foreign price controls would undermine American leadership, hurting patients and workers,” said Alex Schriver, a spokesman for the trade group PhRMA, in a statement. A better way to reduce the price differences, he said, would be to “get foreign countries to pay their fair share for innovative medicines.”
In July, Mr. Trump set a deadline of Sept. 29 for drugmakers to voluntarily lower their prices, as he had asked them to do in an executive order in May. That order said if voluntary compliance did not make enough progress in lowering U.S. drug prices, the Trump administration might “propose a rule-making plan to impose most-favored-nation pricing.” The term refers to a pricing policy that would lower U.S. prices to align with those of peers.
In a news conference Monday focused on Tylenol and autism, Mr. Trump mentioned his drug pricing plans, claiming he would bring huge price cuts. “We subsidize the rest of the world,” he said. “We’re not doing that anymore.”
Mr. Trump’s previous attempt at using international drug prices to establish U.S. prices, from his first term in office, sought to tie the price Medicare paid for certain drugs to the lowest price paid by a group of peer nations. But that effort applied only to the subset of drugs that doctors administer directly to patients, such as chemotherapy or rheumatoid arthritis infusions. The policy was blocked by courts because of process issues, but the courts never addressed the question of whether the policy itself was legal.
That effort involved a special authority granted to Medicare and Medicaid under Obamacare to test experimental programs that could improve health care quality and lower costs. The so-called innovation center is tasked with developing demonstration projects and evaluating their results. But the project was set up to be mandatory everywhere, leaving it open to legal challenges that it was not a true experiment.
In recent weeks, several drugmakers have made announcements to appease Mr. Trump, though they have stopped short of committing to lower the final prices that U.S. government programs, employers and insurers pay.
Eli Lilly said it would raise the sticker price in Britain of Mounjaro, its popular weight-loss drug.
Bristol Myers Squibb said this week that it planned to set the same sticker price in Britain as in the U.S. for a new schizophrenia treatment. The company also recently embraced one of Mr. Trump’s demands — that drugmakers sell their products directly to patients without using insurance — when it started such a plan for a widely used blood thinner, Eliquis.
A possible mandate that would lower U.S. drug prices to the levels in Europe is perhaps the industry’s biggest concern as it faces threats to its business model from the Trump administration. Trump officials earlier this month said they would move to enact a regulatory process that could take drug advertisements off TV. And the industry is still bracing for the possibility of Mr. Trump’s long-promised tariffs on imported medications.
In this term, Mr. Trump has promoted drug price controls less explicitly than he did during his first term in office. So far, he has instead focused on executive orders and speeches demanding that pharmaceutical companies voluntarily adjust their prices in the United States and overseas to establish more parity.
In letters to drugmakers in July, he demanded lower prices for “every single” patient covered by Medicaid, the government insurance program for low-income and disabled Americans. He demanded the same for “all new drugs” across both government and commercial insurance, suggesting that drugs already on the market, other than for Medicaid, would be exempt.
Brand-name drug prices in the United States are three times as high, on average, as those in peer nations. Higher U.S. prices — and the large size of the U.S. market — are a key to the industry’s business model. Mr. Trump and his allies have described the situation as unfair.
In other rich countries like those in Europe, governments strike a hard bargain in negotiating prices with drugmakers and have been willing to walk away if the price is too high.
There is much less willingness to deny patients access to new drugs in the United States. In the U.S., drug prices start very high and generally don’t fall meaningfully until there are multiple patent-protected products competing for the same patients.
Legislation passed during the Biden administration allows Medicare to negotiate the prices of a small number of older prescription drugs each year, but the authority is limited in its reach.
Drugmakers and Trump officials have found common ground in the idea that European countries are paying too little for medicines. In a podcast interview this month, Howard Lutnick, the commerce secretary, took aim at Switzerland, home to giant multinational drugmakers like Roche and Novartis that generate substantial profits from sales in the U.S. market.
“They sell us pharmaceuticals like it’s going out of style, right?” he said. “They make so much money off America, that’s why they’re rich.”
AstraZeneca’s chief executive, Pascal Soriot, told reporters in July that he agreed with the president about leveling drug prices between the U.S. and its peers. Research and development costs, he said, “should be shared more fairly across rich countries.”