President Trump said Tuesday that he struck a deal with Pfizer to lower the prices of its medicine as his administration presses pharmaceutical companies to price their drugs in America at the same lower rates as they do overseas.
Under the deal, Pfizer will sell all their drugs through Medicaid at “most favored nation” prices, which ties the prices of prescription drugs in the U.S. to the lowest price as in other high-income countries.
“The United States is done subsidizing the health care of the rest of the world,” Mr. Trump said in remarks at the White House. “By taking this bold step, we’re ending the era of global price gouging at the expense of American families.”
Pfizer CEO Albert Bourla hailed the agreement as “a historic day,” saying it turns the tide of Americans paying more for drugs.
“For years, other rich nations refused to pay the cost for medical innovation, and as a result, Americans had to assume this proportional cost on their shoulders,” Mr. Bourla said. “This situation we know is not sustainable.”
Separately, the White House unveiled a new website dubbed TrumpRX to allow the sale of drugs at discounted rates. The White House says the site, which will launch soon, will offer drug pricing transparency and will sell drugs at 80% less than they’re available commercially.
Under the deal, Pfizer will lower prices on the drugs in Medicaid in exchange for a three-year reprieve on tariffs as long as it builds manufacturing plants in America. Pfizer also announced a $70 billion investment in research and development initiatives in the U.S.
The Pfizer deal comes as drugmakers face a deadline this week to lower prices. If they don’t, the Trump administration will use a government ruling to bring prices down or start importing cheaper medicine from overseas. The deadline for lowering prices was Monday.
In July, Mr. Trump wrote a letter to 17 drug companies, including Pfizer, to lower prices within 60 days or face consequences. Pfizer is the first drug company to reach a deal to reduce its prices. Commerce Secretary Howard Lutnick said Tuesday that more deals will be announced throughout the fall.
The White House has pushed to secure “most favored nation” pricing pacts with pharmaceutical companies to lower prices. Mr. Trump signed an executive order in May outlining his initiative, and administration officials have been negotiating with drug companies to get them to voluntarily match their American prices to their overseas pricing.
Mr. Trump has long insisted that American consumers spend too much on medication and has sought to pressure drug companies to lower prices through tariffs and other initiatives.
The U.S. has just 4% of the world’s population and accounts for only 13% of all global prescription drug purchases. Yet pharmaceutical companies make 75% of their profits from America, according to the White House data.
• Jeff Mordock can be reached at jmordock@washingtontimes.com.
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