Donald Trump has announced intentions to leverage his authority to lower prescription drug prices in the United States, aiming to align them closer to prices in other countries.
The president mentioned plans to sign an order on Monday that could lead to “nearly immediate” reductions in pharmaceutical prices, estimating cuts of around “30% to 80%.”
On his social media platform, he expressed that it’s “hard and extremely embarrassing” to explain the current situation.
“Pharmaceutical companies have long claimed that American consumers have been unfairly supporting these costs,” he noted.
He proposed a “most preferred country” policy, which means the U.S. would pay the same price as the country with the lowest pharmaceutical costs.
These remarks triggered a decline in pharmaceutical stock prices on Monday, as investors responded to potential profit reductions from lowered U.S. prices.
In early trading, shares of AstraZeneca and GSK in London dropped by 5% and 2.6%, respectively. Novo Nordisk shares in Frankfurt fell by 7.5%, while Roche Holdings from Switzerland saw a decline of 3.6%.
In South Korea, SK Biopharmaceuticals and Samsung Biologics shares fell by 2.7% and 4.7%, and in Hong Kong, Beigen dropped by 8.9%, while Innovative Biology decreased by 7%.
Previously, Trump had targeted high drug prices during his administration, attempting to cap certain Medicare drug prices. However, this effort was halted by a federal court following challenges from the pharmaceutical industry.
The U.S. government currently negotiates prices for the most expensive drugs used in Medicare, part of the Inflation Reduction Act championed by Joe Biden. Medicare serves about 66 million Americans, predominantly those aged 65 and older.
Yet, Trump didn’t clarify whether his forthcoming executive order would extend to Medicare, Medicaid, or other government health programs.
He implied that industry lobbyists didn’t succeed at the White House, despite pharmaceutical companies contributing to his inauguration.
“Campaign contributions can be substantial, but not with me. We’re focusing on making the right decisions. The Democrats have been battling this for years,” he remarked.
