Trump Signs Executive Order Aiming to Lower Prescription Drug Prices

WASHINGTON, D.C. — President Donald Trump signed an executive order on Monday aimed at reducing prescription drug prices in the United States. The directive gives pharmaceutical companies 30 days to negotiate lower prices or face new federal pricing regulations tied to international drug costs.

The order tasks the U.S. Department of Health and Human Services, led by Secretary Robert F. Kennedy Jr., with facilitating these negotiations. If agreements are not reached within the timeframe, a policy will take effect that links the prices the U.S. pays for certain drugs to the lower prices paid by other countries.

During a press conference announcing the order, Trump stated, “We’re all going to pay the same. We’re going to pay what Europe pays.”

It remains unclear how this executive order will affect Americans with private insurance, as the federal government has the most influence over drug prices within Medicare and Medicaid programs. Medicare currently serves nearly 70 million older adults, while Medicaid covers approximately 80 million low-income and disabled individuals.

Pharmaceutical companies have criticized the move. The Pharmaceutical Research and Manufacturers of America (PhRMA), the industry’s leading lobbying group, warned that the policy could hinder innovation and investment in drug development.

“Importing foreign prices will cut billions of dollars from Medicare with no guarantee it helps patients or improves access to medicines,” said PhRMA CEO Stephen J. Ubl. He also cautioned that the rule could make the U.S. more dependent on foreign nations for pharmaceuticals.

Trump’s proposal, often referred to as the “most favored nation” model, was first introduced in 2020 during his initial term. That earlier version was limited to certain drugs administered in doctors’ offices and was blocked in court before it could take effect under the Biden administration.

This latest order revives the concept, expanding it with a broader goal of reducing government drug spending. Trump claimed the plan would save taxpayers “trillions of dollars,” although the White House has not released any formal analysis detailing potential savings or specifying which drugs would be affected.

Joining Trump at Monday’s announcement were several prominent health officials, including Centers for Medicare and Medicaid Services Administrator Dr. Mehmet Oz, Food and Drug Administration Commissioner Dr. Marty Makary, and National Institutes of Health Director Jay Bhattacharya. The group plans to meet with pharmaceutical executives over the next month to renegotiate drug prices based on international benchmarks.

The Department of Health and Human Services does have regulatory power over Medicare and Medicaid drug pricing, though its authority is limited. A 2022 law now allows Medicare to begin negotiating prices for a small number of prescription drugs starting in 2026—a change that drugmakers unsuccessfully challenged in court.

Prices for Americans with private insurance, however, remain difficult for the federal government to influence directly. The U.S. continues to pay more for prescription medications than most other developed countries, a long-standing issue that has drawn bipartisan concern.

Throughout his political career, Trump has frequently criticized the pharmaceutical industry, arguing that U.S. consumers unfairly shoulder the global costs of drug research and development. He reiterated this position in recent statements, emphasizing his intent to prioritize American patients over industry profits.

“This is about doing the right thing for the American people,” Trump wrote ahead of the order’s signing.