Trump signs favorite national drug pricing order

White House officials said President Donald Trump will resume a controversial policy on Monday aimed at cutting drug costs by paying some of the drugs paid by the government to lower prices abroad.

Trump will sign an executive order that includes several different actions to update the effort, known as the "most popular nation" policy.

"For a long time, foreign countries have been able to release the ranks of the American people, and American patients are forced to pay too much for prescription drugs," an official told reporters on Monday.

"The president is serious about lowering drug prices," they said.

U.S. President Donald Trump attended a celebration of the military mother in the East Room of the White House in Washington, DC on May 8, 2025.

Jim Watson | AFP | Getty Images

The official announcement comes after U.S. drugmakers' shares fell in listing trading on Monday. Yililai Falling more than 5%, while Pfizer,,,,, Merck and Johnson and Johnson Reduced by more than 2%.

But White House officials did not disclose the drugs that the order would apply. They said Monday's announcement would be broader than similar policies Trump tried to push in his first term, which only applies to Medicare Part B drugs.

Officials added that the government will pay special attention to drugs with "maximum differences and maximum spending" that may include mass weight loss and diabetes treatments called GLP-1 drugs.

It is unclear how effective the policy is in reducing patient costs. In a social media post on Monday, Trump claimed that drug prices will be “down 59%, plus!”

Officials said the order directed the U.S. Trade Representative and the Department of Commerce’s office to “suppress” drug prices abroad to combat “unreasonable and discriminatory policies”.

"We will work to ensure that negotiations between countries and pharmaceutical companies are unfair, right?" an official said. Pharmaceuticals are “continuously complaining” during these negotiations because these companies usually have to discount drug prices across the country, the official added.

Unlike the United States, several foreign countries provide universal health coverage, and the government is the only payer, providing a huge leverage for negotiating or setting drug prices.

White House officials said they hope drugmakers provide full discounts to "reward" the Trump administration's actions to address foreign price solutions.

Trump's order also directed the Department of Health and Human Services secretary to encourage drugmakers to offer "favorite national prices" on "direct-to-consumer sales" of their drugs.

Within 30 days, the secretary must also set clear targets for price reductions in all U.S. markets, officials said. Officials said this would hold a round of negotiations between HHS and the pharmaceutical industry, but did not provide exact details about the nature of the conversation.

If it is not for "enough progress" toward these price targets, HHS Secretary Robert F. Kennedy Jr.

The order also directs the Food and Drug Administration to consider importing from other developed countries outside Canada. Trump signed a separate executive order in April directing the Food and Drug Administration to improve the process by which states can apply for importing lower-cost drugs from Canada, among other actions aimed at lower prices.

Monday's order also directed the Justice Department and the Federal Trade Commission to actively implement "anti-competitive behavior" to make the U.S. expensive

The Ministry of Commerce will also consider export restrictions that “fuel and make prices low abroad.”

Rand Corporation, a public policy think tank, said it was Trump's latest effort to curb the average price of prescription drugs in the United States, which is on average two to three times higher than other developed countries and 10 times higher than some at most.

The order is a blow to the pharmaceutical industry, which has supported Trump's planned tariffs on prescription drugs. Drugmakers believe that the “most popular country” policy will harm their profits and ultimately undermine their ability to research and develop new drugs.

White House officials argue that if pharmaceutical companies realize that the U.S. “will not pay for innovation alone” and if they raise prices abroad to earn additional income there, they will continue to make money.

One official said drugmakers “should get transactions that allow them to receive financial rewards, thanks to the value they provide to other countries,” one official said.

The policy could help patients by reducing the cost of prescription medications, which is a question of mind for many Americans. According to the 2022 KFF poll, more than a quarter of adults in the United States say the cost of drugs is unaffordable.

The industry also lobbies against similar Trump plans in his first Trump plan. He tried to push the policy in the final months of the semester, but a federal judge stopped working after a lawsuit in the pharmaceutical industry. The Biden administration then abolished the policy.

Politico reported earlier this month that White House officials initially urged Congressional Republicans to include a "favorite country" clause in the main settlement bill they plan to pass in the months they plan to pass, but that policy will specifically target Medicaid drug costs earlier this month. Several Republican members opposed the measure.

How Trump's orders affect patients, companies

PHRMA, the industry's largest trading group, estimates that within a decade, Trump's Medicaid proposal could cost drugmakers as much as $1 trillion.

Some health policy experts say that the "most popular country" drug policies may not be effective in reducing drug costs.

For example, USC experts say the policy “cannot revoke the basic economics of the global drug market”, with 70% of global medicines coming from the United States

"Faced with the choice of US price cuts or the choice between overseas markets that lose weak benefits, we can expect many companies to withdraw from overseas markets with the earliest opportunity," the experts said in an April report.

They say this will allow Americans to pay the same amount for drugs, lower profitable drugmakers, and patients with less innovation in the future.

"All in all, everyone lost." The expert said.

Other experts say another legal battle with the pharmaceutical industry can prevent the policy from taking effect.

But even if the drug industry delayed Trump’s executive order, his administration still has another tool to promote drug prices: Medicare drug price negotiations.

This is a key provision of the Inflation Reduction Act, which gives Medicare the power to negotiate the price of certain prescription drugs with manufacturers for the first time in history.

Trump last month proposed changes to the policies drugmakers have long sought. Legislators on both sides of the aisle could accept the idea, which proposed changes to the rules of change between small molecule drugs and biological drugs.

Trump said last week that he plans to announce tariffs on drugs imported from the United States in the next two weeks. The levies in those plans are designed to promote domestic drug manufacturing.

Drug addicts, including Yililai and Pfizerthose potential responsibilities are being delayed. Given that Trump has taken office, some companies have questioned whether tariffs are needed, as some have announced new U.S. manufacturing and R&D investments.

Despite this, Trump worked hard last week to reshape the drug manufacturing. He signed an executive order that simplifies the path for manufacturers to establish new production sites.

Caplan noted that even if the drug industry delayed the executive order, the government still had another tool available: Medicare drug pricing negotiations.