The Trump administration announced an effort to improve prescription drug prices for the American people, but it is unclear when, or to what extent, Americans will feel relief.
On May 12, Trump signed an executive order titled “Delivering Most-Favored-Nation Prescription Drug Pricing to American Patients,” which directed the administration to work to reduce prescription drug costs by bringing them in line with what other nations pay. Yet the order’s broad strokes had few details about what this would look like.
On May 12, Trump signed an executive order titled “Delivering Most-Favored-Nation Prescription Drug Pricing to American Patients.”
With the unveiling of “TrumpRx” this week, Americans got some answers.
Partnering with Pfizer, beginning in 2026 the federal government will have a website, TrumpRx.gov, through which Pfizer’s prescription drugs can be sold directly to consumers at discounts, without the intermediaries of pharmacy benefit managers such as CVS Health’s Caremark and UnitedHealthcare-owned OptumRx.
To be clear, improving prescription drug affordability is critical. In a 2023 KFF poll, more than 60% of U.S. adults reported taking at least one prescription drug. Almost the same share — 55% — were worried about affording those prescription drugs. Nearly a third said they did not take their drugs as prescribed because of cost, and such rationing or eschewing of even lifesaving drugs like insulin, leads to worse health outcomes.
Americans’ problems affording prescription drugs are attributable in no small part to the fact that we typically pay more for our drugs than other wealthy countries do. Why is that? Some of it is because of access to cutting-edge treatments that come with price tags to develop, but it also comes down to the relatively deregulatory environment of American health care delivery, with the pharmaceutical industry facing limited regulatory constraints on drug pricing.
So, just as the Inflation Reduction Act’s negotiation with insulin manufacturers brought needed relief to Medicare patients dependent on insulin, the cost of which was capped at $35 per month, so, too, would government negotiation with drug manufacturers provide needed relief to Americans of different ages dependent on a broader swath of prescription drugs.
The question is how it will actually work, and there remains ample uncertainty even with Trump’s recent announcement.
At the heart of the White House policy is a concept known as “most-favored-nation” (MFN) drug pricing, which works to bring the cost of prescription drugs in line with what other Organization for Economic Cooperation and Development countries pay.
The White House fact sheet specified that, thanks to the White House’s negotiation with Pfizer, every state Medicaid program would be able to access MFN prices for its prescription drug products via TrumpRx.gov, resulting in “many millions of dollars in savings.”
That promise seems a little less grand when you consider that, by the White House’s own admission, “more than 100 million patients are impacted by the diseases Pfizer’s medicines treat.” The fact sheet specifies savings for just three drugs — with Eucrisia, Xeljanz and Zavzpret becoming available at 80%, 40% and 50% discounts, respectively — and other phrases in the order, like “tangible cost savings,” leave the typical savings unclear. All we can say with any confidence is that the White House has pulled back from Trump’s mathematically impossible promise of “1,000%” reduction in prescription drug costs.
And what, if any, benefit will be enjoyed by the millions of patients taking drugs developed by Eli Lilly (which manufactures widely used drugs such as Prozac and Humalog insulin), Johnson & Johnson, AbbVie, Merck, Amgen and others?
What’s more, it is unclear exactly what the benefit will be for Medicaid patients. Their copayments are already capped under federal law at $4 for preferred drugs and $8 for non-preferred drugs — and are often even lower.
It is unclear exactly what the benefit will be for Medicaid patients.
Among the exact drug discounts in the fact sheet, Xeljanz (which used to treat autoimmune conditions) has a list price over $6,000. While privately insured patients’ out-of-pocket prescription drug costs often are difficult to shoulder, reducing a $6,000 list price by 40% still leaves patients with a $3,600 drug in a country where most Americans cannot afford a $1,000 emergency expense. It’s also far above the roughly $1,400 the average American spends on prescription drugs every year (well above what is spent in other high-income countries). The negotiated price of the migraine drug Zavzpret — around $750 per dose, versus a $1,500 list price — is similarly costly, especially when you account for patients taking multiple doses over the course of a year.
Thus, while these are big cost reductions, the cash prices would most likely remain higher than the insured population would face and prohibitively expensive for the uninsured. What’s more, as with private direct-to-consumer platforms like GoodRx, such payments would not count toward insured patients’ deductibles or out-of-pocket maximums. Thus, in some situations they can lead to more health care spending in a year.
More broadly, there is a fundamental contradiction between TrumpRx's promise and its namesake’s record. While this is hardly the first time Trump has expressed concern about prescription drug affordability, it is difficult to square that concern with his opposition to the Inflation Reduction Act (which capped insulin at $35 for Medicare patients), his support for cuts to Medicaid and the Affordable Care Act (both of which help ensure health care access) and his recent imposition of 100% tariffs on pharmaceuticals (which increases prescription drug costs).
So does this new policy rollout prioritize cost savings for American patients, or will it largely operate as a means for select pharmaceutical companies to avoid those newly announced tariffs?
For many Americans, a trip to the pharmacy means the stresses of figuring out which drugs are covered or how to afford those drugs at all. Reducing high prescription drug costs is vital in improving health equity and outcomes, and despite threats from this administration, the Inflation Reduction Act and health policies such as Medicaid and the Affordable Care Act have worked to expand access to prescription drugs. TrumpRx advertises dramatic reductions in out-of-pocket costs for many prescription drugs, but the jury is still out on what relief it will bring Americans.