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Trump to sign order to cut some U.S. drug prices to match those abroad

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Trump to sign order to cut some U.S. drug prices to match those abroad

US President Donald Trump participates in a celebration of military mothers in the East Room of the White House in Washington, DC, on May 8, 2025.

Jim Watson | AFP | Getty Images

President Donald Trump on Monday will revive a controversial policy that aims to slash drug costs by tying the amount the government pays for some medicines to lower prices abroad, White House officials said.

Trump will sign an executive order including several different actions to renew that effort, known as the “most favored nation” policy.

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“For too long, foreign nations have been able to free ride off of the American people, and American patients forced to pay for too much for prescription drugs,” one official told reporters on Monday.

“The president is dead serious about lowering drug prices,” they said.

Shares of U.S. drugmakers dropped in premarket trading Monday ahead of the official announcement. Eli Lilly fell more than 5%, while Pfizer, Merck and Johnson & Johnson dropped more than 2%.

But White House officials did not disclose which medications the order will apply to. They said Monday’s announcement will be broader than a similar policy that Trump tried to push during his first term, which only applied to Medicare Part B drugs.

It’s unclear how effective the policy will be at lowering costs for patients. In a social media post on Monday, Trump claimed drug prices will be cut by “59%, PLUS!”

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The order directs the Office of the U.S. Trade Representative and the Department of Commerce to crack down on “unreasonable and discriminatory policies” in foreign countries that “suppress” drug prices abroad, the officials said. It also directs the Secretary of the Department of Health and Human Services to encourage “most favored nation prices.”

Within 30 days, the secretary will also have to set clear targets for price reductions across all markets in the U.S., according to the officials. That will open up a round of negotiations between HHS and the pharmaceutical industry, officials said, not providing exact details on the nature of those talks.

If “adequate progress” is not made towards those price targets, HHS Secretary Robert F. Kennedy Jr. will impose the most favored nation pricing on drugs through rulemaking.

The order also directs the Food and Drug Administration to consider expanding imports from other developed nations beyond Canada. Trump signed a separate executive order in April directing the Food and Drug Administration to improve the process by which states can apply to import lower-cost drugs from Canada, among other actions intended to lower drug prices.

It also directs the Department of Justice and Federal Trade Commission to aggressively enforce “anti-competitive actions” that keep prices high in the U.S.

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The Department of Commerce will also consider export restrictions that “fuel and enable that low pricing abroad.” 

It is Trump’s latest effort to try to rein in U.S. prescription drug prices, which are two to three times higher on average than those in other developed nations – and up to 10 times more than in certain countries, according to the Rand Corporation, a public policy think tank.

The order is a blow to the pharmaceutical industry, which is already bracing for Trump’s planned tariffs on prescription drugs. Drugmakers have argued that the “most favored nation” policy would hurt their profits and ultimately, their ability to research and develop new medicines.

But the policy could help patients by lowering prescription medication costs, which is an issue top of mind for many Americans. More than three in four adults in the U.S. say the cost of medications is unaffordable, according to a KFF poll from 2022.

The industry also lobbied against similar Trump plans during his first term. He tried to push the policy through in the final months of that term, but a federal judge halted the effort following a lawsuit from the pharmaceutical industry. The Biden administration then rescinded that policy.

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White House officials initially pressed congressional Republicans to include a “most favored nation” provision in the major reconciliation bill they plan to pass in the coming months, but the policy would have specifically targeted Medicaid drug costs, Politico reported earlier this month. Several GOP members opposed that measure.

How Trump’s order could affect patients, companies

The industry’s largest trade group, PhRMA, estimated that Trump’s Medicaid proposal could cost drugmakers as much as $1 trillion over a decade. 

Some health policy experts have said a “most favored nation” drug policy may not be effective at lowering medication costs.

For example, USC experts said the policy “can’t undo the basic economics of the global drug marketplace,” where 70% of pharmaceutical profits worldwide come from the U.S.

“Facing a choice between deep cuts in their U.S. pricing or the loss of weakly profitable overseas markets, we can expect many firms to pull out from overseas markets at their earliest opportunity,” experts said in a report in April. 

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That will leave Americans paying the same amount for medications, drugmakers with lower profits and future generations of patients with less innovation, they said.

“In sum, everyone loses,” the experts said.

Other experts have said another legal fight with the pharmaceutical industry could prevent the policy from taking effect.

But even if the drug industry pushes back on Trump’s executive order, his administration still has another tool to push down drug prices: Medicare drug price negotiations.

It’s a key provision of the Inflation Reduction Act that gives Medicare the power to negotiate certain prescription drug prices with manufacturers for the first time in history.

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Trump last month proposed a change to that policy that drugmakers have long sought. Lawmakers on both sides of the aisle could be receptive to the idea, which proposes changing rules that differentiate between small-molecule drugs and biologic medicines.

Trump last week said he plans to announce tariffs on medicines imported into the U.S. within the next two weeks. Those planned levies aim to boost domestic drug manufacturing. 

Drugmakers, including Eli Lilly and Pfizer, are pushing back on those potential duties. Some companies have questioned whether the tariffs are necessary, given that several of them have already announced new U.S. manufacturing and research and development investments since Trump took office. 

Still, Trump last week doubled down on efforts to reshore drug manufacturing. He signed an executive order that streamlines the path for drugmakers to build new production sites.

Caplan noted that even if the drug industry pushes back on the executive order, the administration still has another tool at its disposal: Medicare drug pricing negotiations.

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Japan scraps US meeting after Washington demands more defence spending

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Japan scraps US meeting after Washington demands more defence spending

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Japan has cancelled a top-level meeting with the US after the Trump administration abruptly told Tokyo to spend more on defence, sparking anger in Washington’s closest Asian ally.

US secretary of state Marco Rubio and defence secretary Pete Hegseth were due to meet Japan’s defence minister Gen Nakatani and foreign minister Takeshi Iwaya in Washington on July 1 for annual security talks known as the “2+2”.

But Tokyo scrapped the meeting after the US asked Japan to boost defence spending to 3.5 per cent, higher than its earlier request of 3 per cent, according to three people familiar with the matter, including two officials in Tokyo.

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The new, higher demand was made in recent weeks by Elbridge Colby, the third-most senior official at the Pentagon, and sparked anger in Tokyo.

The tension over security issues comes as the allies hold tough trade talks after President Donald Trump in April imposed “reciprocal” tariffs on Japan.

One senior Japanese official said the decision to cancel the July 1 meeting was also related to the July 20 Upper House elections where the ruling Liberal Democratic party is expected to suffer a loss of seats.

Christopher Johnstone, a former senior US government Japan expert, said Tokyo viewed 2+2 meetings as a “very high priority” because they provided “politically valuable opportunities to showcase the strength of the US-Japan alliance”. He said postponing the meeting until after the Japanese election signalled “significant unease in Tokyo about the state of the bilateral relationship and its outlook”.

“Tokyo appears to have concluded that the political risk of a meeting before the election was higher than the potential gain — a pretty extraordinary assessment, if true,” said Johnstone, partner at The Asia Group, a consultancy.

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The friction between Washington and Tokyo comes as the US puts pressure on European and Asian allies to boost defence spending.

Speaking at the IISS Shangri-La Dialogue defence forum in Singapore last month, Hegseth urged Asia-Pacific allies to follow the “newfound example” of Europeans pledging to spend more and cited the threats in the region from China and North Korea.

“The US is now playing hardball with allies in the Asia-Pacific,” said one defence official.

Colby has been at the forefront of that push. In his US Senate confirmation hearing in March, his calls for Tokyo to increase defence spending drew a rebuke from Prime Minister Shigeru Ishiba, who said Tokyo would decide its own budget.

“The Trump administration’s inconsistent and unrealistic message on its expectations for allied defence spending levels in Asia risks backfiring and undermining those officials and experts who are most supportive of the United States in some key foreign capitals,” said Zack Cooper, an Asia security expert at the American Enterprise Institute.

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Colby has taken other positions that have raised anxiety among US allies. The Financial Times recently revealed that he was conducting a review of Aukus, the landmark security agreement between the US, UK and Australia designed to help Canberra procure a fleet of nuclear-powered submarines.

The FT also reported in May that he had told European countries that they should focus their militaries on the Euro-Atlantic region and less on the Asia-Pacific. The stance marked a shift from the Biden administration’s push to involve European allies in Asia to send a unified message of deterrence to China.

In another example of the shift, the Trump administration is not pushing Nato allies to reference the Indo-Pacific in the communiqué at the alliance’s summit in The Hague next week.

At the 2024 summit, members said the Indo-Pacific was “important for Nato”. But three people familiar with the draft of the communiqué that will be released next week said it did not mention the region.

Former president Joe Biden had invested heavily in securing the language, arguing that the European and Indo-Pacific theatres were linked.

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Japan’s defence ministry did not comment on whether the talks had been cancelled, and said no decision had been made on the timing of the next meeting. The state department and Pentagon did not comment.

 

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Federal judge declines to order Trump officials to recover deleted Signal messages

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Federal judge declines to order Trump officials to recover deleted Signal messages

Secretary of Defense Pete Hegseth looks on during a cabinet meeting with President Trump in the Cabinet Room of the White House on April 10.

Brendan Smialowski/AFP via Getty Images


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Brendan Smialowski/AFP via Getty Images

A federal judge in Washington, D.C., has issued a preliminary injunction ordering top national security officials who discussed military operations on the encrypted messaging service Signal to notify the acting archivist of the United States of any messages they have that may be at risk of being deleted. But in calling for those records to be preserved, the ruling stopped short of ordering the government to recover past messages that may already have been lost.

American Oversight, a nonprofit government watchdog, brought the lawsuit after the journalist Jeffrey Goldberg was mistakenly added to a group chat on Signal in which Trump administration officials discussed a planned U.S. military attack against Houthi rebels in Yemen. American Oversight says the officials violated federal records law with their use of Signal, a commercial messaging app that allows messages to be automatically deleted.

In his ruling Friday, U.S. judge James Boasberg said American Oversight had failed to show that the recordkeeping programs of the agencies involved in the case are “inadequate,” or that “this court can provide redress for already-deleted messages,” as the group had requested.

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“Plaintiff has provided no reason to believe that ordering the Attorney General to use her “coercive power” to “shak[e] the tree harder” … would bear any fruit with respect to already-deleted messages,” Boasberg wrote. “The Court therefore cannot conclude that American Oversight’s request for communications that have already fallen victim to Signal’s auto-delete function remains redressable given Plaintiff’s own representations to the contrary.”

But the judge granted the group a partial victory when it comes to messages that have not been erased.

“Because the looming erasure of automatically deleting Signal messages qualifies as such an imminent destruction of records, and because the Attorney General could prevent that destruction by instructing Government officials to halt the messages’ deletion, it remains possible for the Court to provide relief,” he wrote.

“We expect immediate compliance — and if they drag their feet or fail to act, we are fully prepared to pursue further legal action to ensure government records, which belong to the public, are preserved and protected,” said Chioma Chukwu, executive director of American Oversight in a statement.

Questions about potentially classified information

Goldberg’s reporting about the chat shocked military and intelligence experts and became the focus of a review by the Pentagon’s acting inspector general. Lawmakers on the Senate Armed Services Committee have also raised concerns about whether top national security officials shared classified information in the chat.

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In his reporting, Goldberg detailed key exchanges from the Signal chat, including messages in which Defense Secretary Pete Hegseth shared information about targets, weapons and attack sequencing just ahead of the airstrikes.

Hegseth has adamantly denied that any classified war plans were discussed in the Signal chat. The White House has also denied that any classified plans were shared, and said in March that its review of the incident had concluded.

“This case has been closed here at the White House as far as we are concerned,” White House press secretary Karoline Leavitt told reporters. “There have been steps made to ensure that something like that can obviously never happen again, and we’re moving forward,” she said.

Controversy surrounding the use of Signal by administration officials dogged the White House a month later when the New York Times reported that Hegseth shared details of the attack on a second Signal chat that included his wife and brother.

“It is now clear that the use of Signal to conduct official government business by administration officials is widespread: senior administration officials used, and likely continue to use, a commercially available text message application with an auto-delete function and no apparent mechanism to fully preserve federal records on government recordkeeping systems,” the watchdog group wrote in an amended complaint filed in late April.

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Hegseth is named as a defendant in the American Oversight suit, alongside Director of National Intelligence Tulsi Gabbard, CIA Director John Ratcliffe, Treasury Secretary Scott Bessent and Secretary of State Marco Rubio.

What the plaintiffs allege

The plaintiffs allege that officials violated the Federal Records Act by discussing “official government actions” on the messaging platform, which is not an authorized system for keeping federal records, according to their complaint. The 1950 law outlines the legal framework by which federal records are meant to be preserved.

American Oversight has also argued that administration officials failed to preserve their messages, noting that multiple individuals who participated in the group chat had the auto-delete setting turned on.

In an initial ruling in March, Boasberg ordered administration officials to preserve any records from the chat dated March 11 to March 15.

The defendants told the court they had taken steps to comply with the order and preserve records, but American Oversight said in subsequent filings that they had “serious questions” about what exactly the government had saved. They said declarations by defendants submitted to the court lacked key specifics, and that “no Defendant” had attested to saving the chat “in its entirety.”

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In the case of Ratcliffe, the group alleged that the CIA director failed to comply with the court’s order. “Because of this failure, Signal communications may have been lost,” they said. The defendants denounced the allegation saying it sought to “stir public controversy without basis in fact or law,” and that Ratcliffe had complied with the court’s order.

In his opinion issued Friday, Boasberg appeared to cast doubt on American Oversight’s argument, writing that the defendants, “did not appear to have any difficulty in following their respective agencies’ policies to preserve the messages that had not yet been deleted.”

“For these reasons, Plaintiff’s claim that the agencies’ formal recordkeeping programs violate the FRA is unlikely to succeed,” he wrote.

NPR disclosure: Katherine Maher, the CEO of NPR, chairs the board of the Signal Foundation.

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Apollo to finance UK Hinkley Point nuclear plant with £4.5bn loan

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Apollo to finance UK Hinkley Point nuclear plant with £4.5bn loan

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US private equity giant Apollo will provide £4.5bn in debt financing to support the UK’s Hinkley Point nuclear project, in a deal that will help ease financial pressures on the flagship development.

The investment grade financing will be provided as unsecured debt at an interest rate just below 7 per cent, people familiar with the matter said.

The funding could be used for other UK projects by French state-owned electricity group EDF, but Hinkley Point is expected to be the primary target for the debt package.

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The financing meets a key funding gap for the nuclear project, which has suffered from consistent cost overruns. It was expected to cost £18bn and to be completed in 2025 but the estimated cost has swelled to almost £46bn and its start date pushed back to 2029.

This is a developing story

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