Overview

• President Trump’s executive order ties U.S. prescription drug prices to the lowest rates in OECD countries, aiming to lower costs for Americans.
• HHS and CMS have started identifying target prices and outlining enforcement mechanisms for pharmaceutical manufacturers to comply with the order.
• Critics warn the policy could reduce pharmaceutical revenues, potentially leading to 8 to 15 fewer new drugs over the next decade, according to the CBO.
• Proponents argue the measure addresses the imbalance where Americans pay over three times more for brand-name drugs compared to other OECD nations.
• Concerns remain about potential legal challenges, market disruptions, and reduced access to innovative medicines in the U.S. healthcare system.