WASHINGTON (OSV News) — President Donald Trump signed an executive order May 12 that he said would lower prescription drug costs — an issue the U.S. bishops have flagged in recent years — but the exact potential impact of the order was the subject of debate.
Trump signed an executive order to implement what is known as the “most favored nation” policy, which he said would tie the prices of some drugs in the U.S. to lower prices abroad, such as in Europe.
“Basically, what we’re doing is equalizing,” Trump said at an event in the Roosevelt Room of the White House. “We are going to pay the lowest price there is in the world. We will get whoever is paying the lowest price, that’s the price that we’re going to get.”
The order sets a 30-day deadline for drug companies to voluntarily lower their prices, asking that the U.S. pay the same amount that other wealthy countries pay for similar medications, and offers the White House’s support for these pharmaceutical companies to seek higher prices abroad. Officials said they would pursue other regulatory options if the companies did not comply.
Stephen J. Ubl, PhRMA’s chief executive, argued in a statement, “To lower costs for Americans, we need to address the real reasons U.S. prices are higher: foreign countries not paying their fair share and middlemen driving up prices for U.S. patients.”
“The Administration is right to use trade negotiations to force foreign governments to pay their fair share for medicines. U.S. patients should not foot the bill for global innovation,” Ubl said.
However, he qualified his statement, arguing, “Importing foreign prices from socialist countries would be a bad deal for American patients and workers. It would mean less treatments and cures and would jeopardize the hundreds of billions our member companies are planning to invest in America — threatening jobs, hurting our economy and making us more reliant on China for innovative medicines.”
But Sen. Bernie Sanders, I-Vt., ranking member of of the Senate Committee on Health, Education, Labor, and Pensions, and an influential progressive lawmaker, said in a statement, “I agree with President Trump: It is an outrage that the American people pay, by far, the highest prices in the world for prescription drugs.”
“It is beyond unacceptable that we pay, in some cases, ten times more for the same exact prescription drugs than people in other major countries. But let’s be clear: The problem is not that the price of prescription drugs is too low in Europe and Canada,” he said. “The problem is that the extraordinarily greedy pharmaceutical industry made over $100 billion in profits last year by ripping off the American people.”
A 2024 Senate HELP committee report authored during Sanders’ time as the committee’s chair found 10 major pharmaceutical corporations made over $112 billion in profits in 2022 while the price for prescription drugs Americans paid were “nearly triple prices in thirty-three wealthy countries.”
Sanders said that Trump should work with him to codify an effort to lower costs, rather than attempt it through an executive order that could be blocked by courts.
The plan faced disapproval from critics of government-set price controls, including from the libertarian Cato Institute.
“HHS does not have the power to ‘impose’ price controls on private pharmaceutical purchases. If it did, some past administration already would have exercised that authority,” Michael F. Cannon, Cato Institute’s director of health policy studies, wrote on that group’s blog. Cannon suggested that Trump instead expand one of his first term executive orders to ease import barriers from some nations.
The U.S. Conference of Catholic Bishops has previously backed efforts to lower the cost of prescription drugs as a matter of justice, such as provisions to do so in the Inflation Reduction Act of 2022.
“The high cost of prescription drugs affects everyone, but low-income seniors who lack the resources to meet their healthcare expenses are especially vulnerable and will benefit from these provisions,” said Archbishop Paul S. Coakley of Oklahoma City, then-chair of the USCCB’s Committee on Domestic Justice and Human Development, in an August 2022 letter to Congress.
The conference did not immediately respond to OSV News’ request for comment on Trump’s executive order.
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