Drug Pricing: Congress & Executive Order Update
Drug Pricing: Congress & Executive Order Update: Will the trump governance’s executive order on drug prices become law? Probably not, if John Barkett of Berkeley Research Group is correct. Barkett believes Congress is unlikely to codify the order, which sought to lower prices through “most favored nation” pricing. This has raised concerns that lower U.S. prices alone could stifle pharmaceutical innovation because the U.S. currently finances much of the world’s drug development. The executive order also proposed pushing for higher drug prices internationally, but legal and political hurdles may make this approach difficult, and raising drug prices in other countries faces political opposition. According to News Directory 3, challenges remain. Discover what’s next in the world of pharmaceuticals.
Congress Unlikely to Codify Drug Price executive Order, Expert Says
Updated May 27, 2025
Congress is unlikely to codify the Trump administration’s executive order aimed at lowering drug prices, according to John Barkett, managing director at Berkeley Research Group. Barkett suggests the Republican-controlled Congress is wary of “most favored nation” pricing for pharmaceuticals, fearing it could disincentivize pharmaceutical innovation.
Barkett noted the U.S. effectively subsidizes global drug innovation by paying higher prices. He cautioned that lowering U.S. prices without corresponding increases elsewhere could significantly reduce incentives for drug manufacturers to develop new treatments.
The executive order acknowledges this risk, tasking the Commerce Department and the U.S.Trade Representative with pushing for higher drug prices internationally. Though, Barkett questions the feasibility of this approach, citing potential legal and execution challenges. He doubts the U.S. president’s authority to dictate drug prices in other countries like Romania or Brazil.
Even if other countries were amenable, their domestic laws governing drug purchases might prevent them from complying. Furthermore, raising drug prices abroad would likely face the same political opposition as high prices do in the U.S., Barkett said.
What’s next
The future of drug pricing policy remains uncertain, pending potential shifts in congressional priorities and international trade negotiations.