The Blubber

Former President Donald Trump announced on Sunday that he plans to sign an executive order on Monday aimed at lowering the cost of certain prescription drugs — reviving a stalled policy effort from his first term that he has championed since before entering office.

The order, if enacted, would direct the U.S. Department of Health and Human Services to align Medicare’s payments for certain physician-administered drugs with the lowest prices paid in other countries.

“I will be instituting a MOST FAVORED NATION’S POLICY whereby the United States will pay the same price as the Nation that pays the lowest price anywhere in the World,” Trump wrote on his social media platform, adding that he would sign the directive Monday morning at the White House.

“Our Country will finally be treated fairly, and our citizens Healthcare Costs will be reduced by numbers never even thought of before,” he added.

The proposal is expected to target medications covered under Medicare Part B — typically drugs administered in clinical settings, such as cancer treatments and injectable biologics. While the plan may only apply to a limited group of medications, the potential for government savings is significant, though Trump’s claim of saving “TRILLIONS OF DOLLARS” appears overstated.

Medicare, which serves roughly 70 million older Americans, has long been criticized for overpaying for prescription drugs, especially compared to other wealthy nations. Efforts to rein in prices have historically drawn bipartisan support but have failed to make it through Congress.

Trump’s new executive order would revive the “most favored nation” pricing model, linking what the U.S. pays to a benchmark set by a basket of advanced economies.

The pharmaceutical industry is expected to push back hard against the move, as it did in 2020 when Trump issued a similar directive late in his first term. That rule was later blocked in court and never took effect under President Biden.

Industry groups argue that tying U.S. prices to foreign rates would undercut innovation and give overseas governments undue influence over domestic drug pricing. They also warn that price controls could hurt pharmaceutical development.

The scope of the proposed rule is expected to be limited to Medicare Part B, which covers drugs administered during doctor visits. Enrollees typically shoulder a portion of those costs, and traditional Medicare lacks an annual cap on out-of-pocket spending.

A previous Trump-era report found the U.S. pays roughly twice what other nations do for these medications. In 2021 alone, Medicare Part B drug spending exceeded $33 billion.