President Donald Trump and pharmaceutical giant Pfizer announced a landmark agreement aimed at reducing certain drug prices for American consumers. The deal, revealed on July 25, 2023, seeks to align U.S. drug prices with the lowest prices paid in other developed countries, known as the “most-favored-nation” pricing model.
While speaking from the Oval Office, Trump emphasized that the arrangement would enable consumers to access medications at heavily discounted prices, potentially saving them between 50% and 100%. He stated, “No family should ever be forced to choose between filling a prescription and putting food on the table.”
Details of the Agreement
Under the terms of the agreement, every state Medicaid program will have the opportunity to access most-favored-nation prices. This requires Pfizer to offer significant discounts when selling medications directly to American patients. The pricing model will also apply to all new medicines introduced by Pfizer in the United States.
Specific medications included in this initiative are Eucrisa, a topical ointment for atopic dermatitis, available at an 80% discount for direct purchases. Another medication, Xeljanz, which treats rheumatoid arthritis, psoriatic arthritis, and ulcerative colitis, will be offered at a 40% discount. Additionally, Zavzpret, a treatment for migraines, will be available at a 50% discount.
Pfizer’s CEO, Albert Bourla, described the agreement as a significant win for American consumers, stating, “There is no doubt about it. They are the ones that will see a significant impact in their ability to buy medicines.”
Introducing ‘TrumpRx’
In conjunction with the pricing deal, Trump unveiled a new initiative called “TrumpRx.” This direct-to-consumer website will facilitate cash purchases of certain medications, including those from Pfizer, at reduced prices. Trump indicated that this platform would be operated by the federal government, allowing consumers to access medications conveniently online.
The arrangement includes a substantial investment from Pfizer, amounting to $70 billion, directed towards U.S. manufacturing and research projects. In exchange, Pfizer will receive a three-year exemption from tariffs. Trump plans to meet with additional drug manufacturers next week to discuss further steps in lowering drug prices.
This agreement marks a pivotal moment in the ongoing discussion about pharmaceutical pricing in the United States and highlights the administration’s commitment to making medications more affordable for American families.