Chamber Urges Trump to Refocus Drug Pricing Efforts

The U.S. Chamber of Commerce’s Global Innovation Policy Center (GIPC) is calling on President Donald Trump to reconsider his Executive Order on Most Favored Nation (MFN) pricing for U.S. medicines, which the GIPC said “would jeopardize the innovation that has made the United States a global leader in life sciences.”

In the Chamber’s latest blog post, the GIPC’s Senior Vice President, Global Innovation Policy Brad Watts and Chamber Vice President of Health Policy, Lexi Branson—while acknowledging the goal of reducing drug prices as a “worthy one”—outlined the risks of MFN pricing and called on the Administration to instead “focus on market-based solutions that lower costs while preserving the incentives that drive medical breakthroughs.”

Trump’s May Executive Order 14297, titled “Delivering Most-Favored-Nation Prescription Drug Pricing to American Patients,” gave companies 60 days to extend MFN pricing to all Medicaid patients, for newly launched drugs, to return increased revenues from negotiations with countries to American patients, and to provide for direct purchasing options to patients at MFN rates.

The Order aims to reduce drug prices “almost immediately, by 30% to 80%” via a “most favored nations” policy that will mandate U.S. citizens pay the same price as the nation paying the lowest price. As a result, prices in other developed countries will rise “to equalize,” said Trump in a May social media post. So far, Pfizer and AstraZeneca have signed agreements on MFN pricing with the administration.

But the GIPC post said MFN pricing would erode the incentives the U.S. R&D ecosystem has to take on the leadership role in bringing biopharmaceutical innovation to market:

“President Trump has argued that the U.S. leads the charge in pharmaceutical innovation, funding much of the world’s progress in this field. MFN pricing would jeopardize this leadership, disincentivizing manufacturers from developing new drugs and taking us one step backward in the race to cure cancer and other deadly diseases.”

A report cited in the post, published by Vital Transformation on September 30, claimed that the MFN policy would result in a loss of 1.98 to 2.2 million jobs (40% of U.S. biopharma industry jobs); a loss of $600 billion in federal tax revenue and $450 billion in state tax revenue; and a loss of up to $2.4 trillion in earnings generated by the biopharma sector, among other findings. It also estimated that MFN policies could reduce U.S. life sciences R&D spending by 18.5% and cut clinical trial activity by up to 75%. Vital Transformation said it was asked to conduct the analysis but did not disclose by whom.

The Chamber’s blog post cited two other Chamber-produced reports—the Patient Access Report and Research Deserts Report—which it says, combined with the Vital Transformation report, confirm that “price controls like MFN are a step in the wrong direction.”

The post further claimed that MFN pricing would hurt U.S. patients, making them subject to delayed access to medicines. According to the GIPC, German patients wait an average of 133 days to access new treatments, in Spain the delays can be up to 500 days, and in Canada some patients move to the United States rather than wait for new drugs.

Patient advocacy groups like Patients for Affordable Drugs Now have championed Trump’s focus on lowering drug prices, but question how the MFN process will work in practice and have urged the administration to ensure pharmaceutical companies don’t simply raise drug prices overseas to make up for lost profits.

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