Trump announces lower drug price deals with 9 pharmaceutical companies
[December 20, 2025]
By SALLY HO
U.S. President Donald Trump announced Friday that nine drugmakers have
agreed to lower the cost of their prescription drugs in the U.S.
Pharmaceutical companies Amgen, Bristol Myers Squibb, Boehringer
Ingelheim, Genentech, Gilead Sciences, GSK, Merck, Novartis and Sanofi
will now rein in Medicaid drug prices to match what they charged in
other developed countries.
As part of the deal, new drugs made by those companies will also be
charged at the so-called “most-favored-nation” pricing across the
country on any newly launched medications for all, including commercial
and cash pay markets as well as Medicare and Medicaid.
Drug prices for patients in the U.S. can depend on a number of factors,
including the competition a treatment faces and insurance coverage. Most
people have coverage through work, the individual insurance market or
government programs like Medicaid and Medicare, which shield them from
much of the cost.
Patients in Medicaid, the state and federally funded program for people
with low incomes, already pay a nominal co-payment of a few dollars to
fill their prescriptions, but lower prices could help state budgets that
fund the programs.
Lower drug prices also will help patients who have no insurance coverage
and little leverage to negotiate better deals on what they pay. But even
steep discounts of 50% found through the administration’s website could
still leave patients paying hundreds of dollars a month for some
prescriptions.
William Padula, a pharmaceutical and health economics professor at USC,
said Medicaid already has the most favorable drug rates which in some
cases will be close to what the “most-favored-nation” price is so it
remains to be seen what other impacts it could have, such as more
research and development.
“It can’t be bad. I don’t see much downside but it’s hard to judge what
the upside is,” Padula said.
And while it is significant that Trump was able to get big drugmakers to
the table to negotiate lower prices, it will take years to gage how
effective this initiative is in terms of more people obtaining more of
the medicines they need.
“It’s good for their stock and it’s good for their future” research and
development, Padula said of the pharmaceutical companies. “It’s clearly
influential but will all this add up to a major effect? Nothing really
matters here unless our health gets better as a country.”
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President Donald Trump speaks during an event on prescription drug
prices in the Roosevelt Room of the White House, Friday, Dec. 19,
2025, in Washington. (AP Photo/Evan Vucci)
 Trump administration officials said
the drugmakers will also sell pharmacy-ready medicines on the
TrumpRx platform, which is set to launch in January and will allow
people to buy drugs directly from manufacturers.
Companies such as Merck, GSK and Bristol Myers Squibb also agreed to
donate significant supplies of active pharmaceutical ingredients to
a national reserve and to formulate and distribute them into
medications such as antibiotics, rescue inhalers and blood thinners
as needed in an emergency.
The New Jersey-based Bristol Myers Squibb further announced that it
will be giving for free to the Medicaid program its signature blood
thinner prescribed to reduce the risk of blood clots and stroke.
Known as Eliquis, it is the company’s top prescribed drug as well as
being one of Medicaid’s most widely-used medicines.
Padula said the donations — which encompass some of the world’s most
critical medicines — are a significant step toward health equity and
an acknowledgement that the drugmakers can afford to seek profits
elsewhere in their operations. Eliquis already has been one of the
most profitable drugs ever made.
“It’s a thoughtful health equity move that they can afford given
that it’s been such a blockbuster,” Padula said of the Eliquis
donation.
Other major drugmakers including Pfizer, AstraZeneca, EMD Serono,
Novo Nordisk and Eli Lilly struck similar deals with the Trump
administration earlier this year.
Though individual terms were not disclosed, the administration has
now negotiated lower drug prices with 14 companies since Trump
publicly sent letters to executives at 17 pharmaceutical companies
about the issue, noting that U.S. prices for brand-name drugs can be
up to three times higher than averages elsewhere.
Trump said he effectively threatened the pharmaceutical companies
with 10% tariffs to get them to “do the right thing.”
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