Trump’s drug-pricing deals won’t benefit most Americans today. They could over time.

The answer is likely “No” — at least not in the near future — according to some health policy analysts and drug-pricing experts.
The confidential agreements lack some critical details and largely don’t help the roughly two-thirds of Americans who use private health insurance, they say. It’s also unclear whether the deals — which are voluntary on the part of drugmakers — will last beyond the current administration.
“The vast majority of consumers are not going to see any benefit in their pocketbook,” said Chris Meekins, a Raymond James health care analyst, and a former health official in the first Trump administration.
Rachel Sachs, a senior adviser in the Office of the General Counsel at the Department of Health and Human Services during the Biden administration, said the deals’ confidential nature makes them harder to judge.
“The administration is making choices to continue hiding the details of these agreements in a way that should not give people confidence about their actual impact on patients,” said Sachs, a law professor at Washington University in St. Louis.
Benefits over time
Trump administration health officials counter that some benefits for health care consumers will be revealed over time. In re-orienting how much countries worldwide pay for pharmaceuticals in the long run, they say, Americans who won’t benefit right away will eventually pay lower prices as well. A key component of the Trump administration effort is to push other wealthy countries to pay more for drugs while pressuring drugmakers to use some of those profits to lower U.S. prices.
“Every new drug launched in the United States, across all lines of business — commercial, Medicaid, Medicare and cash — will launch at a most-favored-nation price that results in savings for all Americans,” said Chris Klomp, director of Medicare at the Centers for Medicare and Medicaid Services. “It also represents an orderly rewiring of global drug pricing that does not destabilize the industry and does not cannibalize access and innovation, but allows for better access for Americans.”
President Donald Trump has for years pushed for the so-called most-favored-nation approach to drug prices in the U.S., in which the amount charged to Americans is set at the lower levels paid by other wealthy countries, adjusted for other nations’ purchasing power.
Earlier this year, Trump sent letters to 17 drugmakers demanding they offer their drugs at MFN prices to Medicaid and work to offer their medicines directly to patients at steeply discounted prices and ensure newly launched drugs are set at an MFN price in the U.S.
So far, 14 companies — Amgen, AstraZeneca, Boehringer Ingelheim, Bristol Myers Squibb, Eli Lilly, EMD Serono, Genentech, Gilead, GSK, Merck, Novartis, Novo Nordisk, Pfizer and Sanofi — have signed confidential agreements with the government. And Trump has indicated he will soon announce deals with Johnson & Johnson and other drugmakers.
A complicated reality
While several of the drugmakers have pledged to offer many of their drugs to Medicaid at MFN prices, it is unclear which medicines are exempted under the confidential deals or how those prices differ from the heavily discounted prices Medicaid already receives.
“Whether or not these MFN prices will actually yield savings for state Medicaid programs is an open question and difficult to analyze because of the kind of lack of readily available data,” said Juliette Cubanski, deputy director of the program on Medicare policy at health policy group KFF.
Under the agreements, the MFN price is determined by taking the second-lowest price paid for a drug after factoring in discounts and rebates in Canada, Denmark, France, Germany, Italy, Japan, Switzerland and the United Kingdom, adjusted for each country’s income level.
“Our analysis suggested that this was very fair,” a senior CMS official granted anonymity to discuss the method said. “It didn’t undermine the objectives of the president’s policy.”
Earlier this month, the Trump administration struck a deal with the United Kingdom that will exempt British pharmaceuticals from tariffs. In exchange, the U.K. committed to increasing its National Health Service’s spending on medicines by about 25 percent in the long term. Trump has indicated he expects other European nations to follow suit.
Industry sees problems
Meanwhile, industry groups are vocally warning that the Trump administration’s most-favored-nations approach will be deleterious to U.S. dominance in biotech innovation. Some worry that lower revenues could lead to reduced investment in new medicines.
Robert Zirkelbach, spokesperson for brand-drug lobby Pharmaceutical Research and Manufacturers of America, said any type of price controls is the wrong approach at a time when China is rapidly growing its pharmaceutical industry.
“The decisions that we make in Washington in the next couple of years are going to determine whether the United States continues to lead the world in medical innovation or not,” Zirkelbach said. “This is not speculative. This is exactly what we saw happen in Europe, where they adopted price controls and drove investment and jobs and innovation out of that region.”
The Biotechnology Innovation Organization, which represents smaller biotechs than PhRMA, said that while lowering health care costs for Americans while pressing other nations to pay a “fair share” for drugs is a top priority for the trade lobby, a most-favored-nations approach harms the ability of upstart firms to bring new medicines to market.
“MFN uniquely harms small and mid-size biotech innovators, which are responsible for discovering and developing more than half of all new medicines,” said BIO spokesperson Sarah Alspach. “And it fails to rein in the opaque middlemen who line their pockets at the expense of hardworking Americans.”
Known as pharmacy benefit managers, those companies, which negotiate drug prices on behalf of employers and insurers, have come under fire. Democrats, Republicans and drugmakers argue that the entities can create incentives for higher drug prices because they are sometimes paid based on the rebates off list prices negotiated with drugmakers. The higher the list price, the higher the payout.
Direct-to-consumer benefits
But one component of Trump’s agreements with drugmakers could, in the long run, potentially sideline some of those middlemen.
TrumpRx.gov, a government website that directs people to drugmaker direct-to-consumer programs, is set to launch in January. If it sees widespread uptake in the future, it could create a commercial avenue that might decrease pharmacy benefit managers’ ability to negotiate the drug prices on behalf of employers and insurance plans.
In the short term, however, public health experts say direct-to-consumer sales — where drugmakers sell a medicine at a discount off its list price — will likely benefit only a small subsection of patients who are either uninsured or underinsured.
That’s because direct-to-consumer purchases of drugs do not currently count toward health insurance deductibles, so most insured Americans would likely be better off getting their medicines through their insurance, according to KFF’s Cubanski.
“I think it’s possible that people could benefit if they don’t have coverage for those medications through their insurance,” Cubanski said.
Zirkelbach said PhRMA advocates for direct-to-consumer spending to count toward health insurance deductibles — a change he argues would help patients directly benefit from a competitive marketplace.
“We’ve absolutely had those conversations,” Zirkelbach said. “We think that’s an important conversation.”
But Meekins cautioned that drugmakers could end up with greater ability to raise prices if PBMs and insurance companies can no longer act as intermediaries on behalf of patients.
“I think the pharmaceutical companies are going after PBMs … because they believe that the PBMs are squeezing the pharmaceutical companies’ profits, and they want their profits to grow,” Meekins said. “If PBMs go away, pharmaceutical companies will make more money. Period.”
Some consumer advocates say the agreements might not be durable once Trump leaves office unless the administration codifies them through regulations that motivate drugmakers to continue launching new drugs in the U.S. at MFN prices.
“I don’t think that we can over the longer term … expect any of this back-room handshake dealmaking is going to amount to anything,” said Steve Knievel, who works for consumer advocacy group Public Citizen’s Access to Medicines program. “That’s why we have a strong preference for actually getting meaningful changes through law.”
Still, Brian Reid, principal at health consultancy Reid Strategic, said it is unlikely that, come Jan. 20, 2029, drugmakers would be able to instantly change their drug-pricing philosophy.
“The thought is this is going to reshuffle the way the systems are built in, the way drugs are priced, here and abroad, and that is going to be hard to unwind once it starts being in place,” Reid said.