Trump’s Drug Pricing Plan Cut 12% on Some Medicines

By VirentaNews Staff — May 08, 2026

In 2020, the Trump administration launched an ambitious policy promising to slash U.S. prescription drug prices by forcing pharmaceutical companies to sell medications at rates no higher than those in other developed nations—a model known as the Most Favored Nation (MFN) rule. The initiative targeted high-cost drugs under Medicare Part B, aiming to close the gap between American prices and those in countries like Canada, Japan, and the United Kingdom, where drug costs are significantly lower. While some medications saw price reductions of up to 12%, a comprehensive analysis by the Kaiser Family Foundation (KFF) reveals that many other critical drugs experienced sharp increases, with insulin and cancer therapies among the most affected. Ultimately, the net effect fell far short of promised savings, leaving patients and policymakers questioning the effectiveness of the approach.

The Push for Affordable Medications

The U.S. spends more on prescription drugs per capita than any other nation, with prices often two to three times higher than in peer countries. This disparity became a central political issue, prompting both parties to propose reforms. President Trump’s MFN executive order, signed in September 2020, required drugmakers to set U.S. prices for certain Medicare-covered drugs at or below the lowest price offered in six comparator nations: Canada, the UK, Germany, France, Japan, and Sweden. The policy initially targeted 50 high-expenditure drugs, with insulin, rheumatoid arthritis treatments, and oncology drugs in focus. Supporters argued it would save taxpayers billions annually. However, legal challenges, industry pushback, and implementation delays hindered rollout, and the Biden administration ultimately suspended the rule in 2021—though its brief enforcement window offered a revealing case study in drug pricing dynamics.

Limited Impact Amid Industry Resistance

During the short period the MFN rule was partially enforced, price adjustments were inconsistent. According to data compiled by KFF Health News, 14 of the 50 targeted drugs saw price reductions, with average cuts of 9–12%—notable but modest gains. For example, the cost of the arthritis drug adalimumab (Humira) dropped slightly after years of sustained increases. However, the broader market response was counterproductive: manufacturers raised prices on non-targeted but related medications, often within the same therapeutic class. Insulin analogs not covered by the rule, such as insulin glargine and insulin lispro, saw price hikes of 8–15% in the same period. Similarly, cancer drugs like trastuzumab (Herceptin) increased in cost despite being under scrutiny. Industry analysts suggest this was a strategic response—firms absorbed minor losses on MFN-affected drugs while boosting profits elsewhere to maintain overall revenue.

Market Realities Undercut Policy Goals

Experts point to structural flaws in the MFN model as a key reason for its limited success. According to KFF, the rule failed to account for complex supply chain markups, rebates, and pharmacy benefit manager (PBM) practices that distort final consumer prices. Moreover, the selection of only 50 drugs ignored the broader ecosystem of high-cost medications, allowing manufacturers to shift focus to unregulated products. Economists at the Peterson Center on Healthcare noted that without comprehensive price controls or negotiation authority, isolated interventions like MFN are easily circumvented. The policy also faced legal challenges from pharmaceutical trade groups, who argued it exceeded executive authority and violated existing trade agreements. A federal court ultimately blocked full implementation, citing regulatory overreach—further limiting its real-world impact.

Patients Still Pay the Price

The uneven outcomes of the MFN initiative left many patients no better off financially. While some seniors on Medicare Part B saw modest reductions in out-of-pocket costs, others faced higher prices for essential medications, particularly in chronic disease management. Diabetics, for instance, continued to pay over $100 per vial for insulin despite public pledges to lower costs. Rural hospitals and clinics that rely on Medicare reimbursement rates were also affected, as sudden price shifts disrupted purchasing budgets. The lack of transparency in drug pricing meant that even when list prices dropped, patients rarely saw equivalent savings at the pharmacy counter. Advocacy groups like Families USA argue that without systemic reform—including direct government negotiation and importation allowances—such piecemeal policies will continue to disappoint.

Expert Perspectives

Health policy experts remain divided on the legacy of the MFN rule. Dr. Aaron Kesselheim of Harvard Medical School called it “a bold but poorly executed attempt to correct market failure,” noting that while the concept has merit, its narrow scope and legal vulnerabilities doomed it from the start. In contrast, industry representatives from PhRMA labeled the policy “government overreach that threatens innovation,” warning that aggressive price controls could reduce incentives for drug development. Some economists suggest hybrid models—such as referencing international prices while allowing risk-based adjustments—might be more sustainable. Ultimately, both critics and supporters agree that durable reform requires congressional action, not executive orders.

Looking ahead, the debate over drug pricing shows no signs of abating. With the Inflation Reduction Act now enabling Medicare to negotiate prices on a limited number of drugs starting in 2026, policymakers have a new tool—but one that faces similar legal and logistical hurdles. The MFN experiment serves as a cautionary tale: well-intentioned reforms can falter without broad legislative backing, robust enforcement, and consideration of market behavior. As drug costs continue to strain household budgets and federal programs, the search for effective, equitable solutions remains urgent.

Source: Reddit