Just over a year ago, President Donald Trump signed an executive order titled “Delivering Most-Favored Nation Prescription Drug Pricing to American Patients.” The aim of the order is to reduce the cost of prescription drugs by linking U.S. prices to the lower prices paid for the same drugs in other high-income countries. Less talked about is how the order instructs the secretary of commerce and United States trade representative to take appropriate action against other nations that the Trump administration accuses of unfair practices to keep their own drug prices down. The stated goal being to end what the administration calls global freeloading on U.S. innovation. Last December, under the threat of tariffs, the United Kingdom agreed to an arrangement with the United States that claims to “deliver shared prosperity for American and British Citizens alike.” As part of the arrangement, the U.K. government agreed to increase the net price paid by its National Health Service for prospective new medicines by 25% as of April 2026. The arrangement also alters how the U.K.’s National Institute for Health and Care Excellence assesses new medicines and the prices it recommends the NHS pay. With the U.K. government’s commitment to double its spending on pharmaceuticals by 2036 under the arrangement, it is estimated by a leading health economist that the deal will cost Britain around 64 billion pounds (more than $86 billion). However, the biggest cost is the prediction that an additional 330,000 people in the U.K. could die by 2036 because of the deal drawing much needed money away from other parts of the NHS. Despite the promises made by Trump and the window dressing that is Trump Rx, the president’s discount prescription drug initiative, prices are not and will not come down for Americans. The true beneficiaries of Trump’s most favored nation drug pricing efforts will be the pharmaceutical industry, which will now not only extract higher prices abroad but also keep American prices intact. Just like the Pfizers of the world began working with the U.S. government more than 40 years ago to expand global intellectual property and patent protections that resulted in the World Trade Organization and grew their monopoly power at home and abroad, Trump’s tariff threats are doing the same work. The following shows why Trump’s plan, far from challenging the pharmaceutical industry’s power, is yet another illusion of access. It is drawn from “Pharma Monopoly: The Battle for the Future of Medicines,” written by myself and Rohit Malpani, and published next week by Polity Books . — Tahir Amin In October 2024, the American Cancer Society released a study that found more than one-third of fundraising stories on the GoFundMe crowd-funding platform in the United States related to experiences of medical financial hardships and health-related social needs. Out of crowdfunding campaigns examined, 91,113 of them were cancer-related. Just a few months later, the CEO of the insurance company UnitedHealthcare, Brian Thompson, would be shot and killed in the middle of Manhattan on an early weekday morning. Despite the shocking and unjustified nature of the act, it led to an outpouring of online vitriol and anger directed at the healthcare industry. Many Americans shared their stories of how they had been denied coverage or left with bills that had caused distress and even the death of loved ones. The populist rage came from all sides of the political spectrum. Medical professionals also jumped in to express their disgust with the insurance system and how demoralizing it was to their profession. Although this dark episode related to an insurance company executive, there were concerns CEOs in other sectors with which the public were disgruntled could become targets.
Recent polling shows that one-quarter of American adults have difficulty affording their prescriptions. Thirty percent of the adults surveyed said they had not taken the medicine they were prescribed due to costs. This included adults either not filling their prescription, cutting their pills in half, or skipping a dose. Those most worried about affording their prescriptions were Black and Hispanic adults. Stories of Americans not being able to afford their medicine, going bankrupt, crossing the border to Mexico or Canada to buy cheaper insulin, or even dying are more common than one would think for one of the richest countries in the world. On average, Americans pay nearly three times more for their prescription drugs than people in 33 other high-income countries. One-quarter of American adults have difficulty affording their prescriptions. The access to medicines debate has largely focused on the Global South. This is understandable given it was the HIV/AIDS pandemic and the unaffordable prices of ARVs that would give birth to the access to medicines movement. Since then, the Global South has lurched from one public health emergency to another. Even so, a realization has set in that the high prices of medicines or misdirected R&D is not just affecting the Global South. It is also an issue for the Global North, especially the United States.
This tipping point probably came when Gilead Sciences, a Californian biopharmaceutical company, launched its hepatitis C cure, Sovaldi, in 2013. At roughly $1,000 per pill, or $84,000 for a single course of treatment lasting three months, it was met with alarm and anger in the United States and elsewhere. The pricing of the drug would cause a crisis in government and local state budgets in Europe and the United States, leading to rationing of the drug to those who had the most severe liver conditions. At one point, because of Gilead’s exorbitant pricing, it would have been cheaper for the US government to acquire the company than pay for the full course of treatment for all people living with hepatitis C in the United States. Such was the outcry that the US Senate Committee on Finance launched an investigation that found Gilead had pursued a business model to maximize revenue regardless of the human consequences. Senator Ron Wyden of the Democratic Party who co-led the investigation would capture what lay ahead when he said, “If Gilead’s approach to pricing is the future of how blockbuster drugs are launched, it will cost billions and billions of dollars to treat a fraction of patients.”
Examples of this kind of egregious pricing of medicines are now common in the West. It has led to a new wave of activism that recalls the efforts of HIV/AIDS activists at the turn of the century. In the United Kingdom, Boston-based biopharmaceutical company Vertex priced its patented cystic fibrosis drug, Orkambi, at £105,000 per patient per year. In the United States, the drug was listed at $272,000 (£207,000) and around $251,000 in Canada (£146,000). Vertex had not even bothered to register and sell Orkambi, or its later cystic fibrosis drug called Trikafta, at any price in a number of countries in the Global South, leaving families there with inadequate treatment or nothing. While Orkambi helped to extend and improve the outcomes of the lives of children and young adults with cystic fibrosis, it was not a cure. The UK National Health Service (NHS), which negotiates prices based on cost-effectiveness assessments, refused to pay the price Vertex had demanded. This led to a deadlock and the drug not being available to patients. Global campaigns were launched for the UK government to set aside Vertex’s patent so that cheaper generics could be made available. Campaigners even identified generic versions of the drug in Argentina that could be exported, because Vertex did not have a patent there. This campaign would also coordinate with groups in the Global South who were demanding that the drug be registered in their countries and that the manufacturing or import of low-cost generics be allowed. It was only after much public pressure and delay that Vertex and the NHS would agree on a price (which remains commercially confidential). Vertex maintained its position of power by not having its patents set aside, while the UK government saved some face by achieving a cost reduction, despite settling on a price that was still likely above what it felt it should pay. Even though availability of the medicine improved in the United Kingdom thanks to the unsung and courageous efforts of patient groups and activists, the fight continues for people in the rest of the world who are still unable to readily access the drug.
There are a number of key factors contributing to the differences in drug prices between countries in the Global North. One key difference is that the United States believes in a version of the free market where the government should not interfere in price setting. The market knows best and that applies also to essential goods, such as medicines. This explains, according to one study, how from 2008 to 2021 the launch prices for drugs categorized as new increased exponentially by 20% per year in the United States. For nearly half of these drugs, the initial price was above $150,000 per year. In contrast, many governments in the Global North negotiate with pharmaceutical companies the price they are willing to pay by employing a cost-effectiveness calculation, as highlighted in the case of Orkambi described above. Only recently has the United States started to catch up with the rest of the Global North countries by allowing its main government health agency to negotiate drug prices, although it is limited to the seniors’ market. This leaves the majority of Americans at the mercy of a private market where pharmaceutical companies hold most of the power. The market knows best and that applies also to essential goods, such as medicines. Despite the growing number of American drug pricing horror stories, the pharmaceutical industry and many politicians in the United States want its citizens to believe that their drug prices would be lower but for foreign freeloading. The Trump Administration has been more explicit about marrying lower drug prices in the United States to higher prices in other wealthy industrialized countries. Drug companies, and now the Trump Administration, contend that it is because of the price controls introduced by other nations that Americans foot the bill to ensure the R&D for the next generation of medicines. If it were not for these price controls, pharmaceutical companies would have higher revenues available to make larger investments and develop more pathbreaking medicines. A related argument is that, because of a lack of price controls and cost-effectiveness assessments of new drugs, Americans get access to newer medications sooner. As a result, this gives them greater freedom of choice compared to other wealthy countries. Many of these are narratives that were invented by the pharmaceutical industry in the late 1990s. Some were in response to a movement started by senior citizens against the high prices of essential prescription drugs. So persuasive were they that the US Department of Commerce International Trade Administration put out a report making the industry’s arguments for them. Yet, the reality is very different. The pharmaceutical industry today is driven by financialized business models. These business models do not just determine what the next drug will be that a company will invest in and patent. They also funnel a significant chunk of profits extracted from Americans and patients around the world into the pockets of shareholders and executives through share buybacks and dividends.
The impact of neoliberal policies emanating from the United States over the past 40 years has armed the pharmaceutical industry with more power than it has ever held globally. With this monopoly power and political influence, it has constructed its own private empire that allows it to decide which medicines it develops, where it makes them available, and what prices it sets. Such unfettered power not only harms patients in the Global South but also hurts Americans and others in the Global North. As for the narrative that Americans have greater freedom of choice when it comes to the availability of medicines, the question that does not get asked enough is: what good is that freedom if you cannot afford to pay for it?
The post At the Mercy of Big Pharma appeared first on Truthdig .