Trump administration’s MFN drug pricing deals may cut projected Medicare savings by up to 80%

The White House announced "most-favored-nation" pricing agreements with 26 pharmaceutical companies, saying the contracts would lower drug costs for federal programs. The deals require companies to match prices paid in other developed nations for certain medicines and to apply the same pricing to new drugs.

A new analysis from Mass General Brigham suggests the agreements could actually reduce projected Medicare savings by almost 80 percent, because the MFN terms may limit the government’s ability to negotiate deeper discounts elsewhere.

The latest round of agreements added nine mid‑size firms that pledged to offer Medicaid programs the same foreign‑price benchmarks, contribute critical medicines to national stockpiles, and increase U.S. manufacturing investment. However, the specific terms of the contracts remain confidential, leaving the true impact on overall drug spending uncertain.