Overview

• On July 31, President Trump sent letters to the CEOs of 17 major pharmaceutical companies to enforce his May 12 executive order on most-favored-nation pricing
• The letters require extending MFN pricing to Medicaid programs and guaranteeing those rates for newly launched drugs
• Manufacturers are also ordered to return increased revenues earned abroad to American patients and establish direct-to-consumer sales at MFN prices
• CEOs must commit to these terms within 60 days or face the threat that the administration will “deploy every tool in our arsenal” to secure compliance
• The administration notes that U.S. patients currently pay more than three times what peer nations pay for many brand-name drugs, underpinning the push for price parity