President Donald Trump's deals with pharmaceutical companies will likely have only a limited impact on Americans' drug spending, experts say.
Since Sept. 30, the Trump administration has struck deals with 14 drugmakers in exchange for tariff cuts, according to the agency. White House.
In agreements that have not yet entered into force, “most favored nationThey are pegging U.S. prices to those in other rich countries, lowering the amount Medicaid pays for drugs, and also offering discounts for people paying cash through TrumpRx, a new self-pay platform.
However, most deals do not affect how much people with private insurance or Medicare pay for drugs. People with Medicaid, who typically have minimal or no copays for prescriptions, already pay very little.
“Generally speaking, most people with insurance coverage will still be better off using their insurance to get their drugs rather than buying through the TrumpRx direct-to-consumer portal,” said Juliet Kubanski, associate program director for Medicare policy at KFF, a nonpartisan health policy research group.
Many aspects of the deals remain unknown.
“There's virtually nothing written about them on paper other than press releases,” said Richard Frank, director of the Brookings Institution's Health Policy Center, a nonpartisan think tank. “It's unclear.”
A full list of drugs covered by the deal is not available. However, the White House announced several of them, including Merck's diabetes drug Januvia, Sanofi's blood thinner Plavix, Amgen's cholesterol-lowering drug Repata, Genentech's flu drug Xofluza, and Gilead's hepatitis C drug Epclusa. Sciences,” about the multiple sclerosis drug Mayzent from Novartis, as well as blockbusters for weight loss from Novo Nordisk and Eli Lilly Wegovy and Zepbound.
Two of the drugs are already subject to Medicare price negotiations under President Joe Biden's Inflation Reduction Act: Januvia was included in the first round and Vegovi in the second.
Some of the discounts announced represent sharp reductions in list prices. Epclusa, for example, will cost $2,425 for people paying cash through TrumpRx, compared to $24,920. And the average monthly cost of Wegovy and Zepbound, which are currently available for $500, will start at $350 and drop to $250 over the next two years.
Art Kaplan, director of medical ethics at New York University Grossman School of Medicine in New York, said that without a complete list of the drugs covered by the deals, it is difficult to assess their overall impact.
Some of the drugs named, Kaplan said, are not among the most expensive in the U.S. or already have generic versions that are typically cheaper for patients.
Several generic versions of Plavix are available, including the one sold by the drug manufacturer itselfFor example. The hepatitis C drug Epclusa is also available as a generic. Some of the drugs that have had their prices cut but do not have generic equivalents are used by relatively few patients and have a “negligible” impact on overall drug spending, Kaplan said.
Another drug, Xofluza, must be taken within 48 hours of the onset of flu symptoms, which may make it inappropriate for an online platform like TrumpRx, he said.
In an email, a White House spokesman said some of the lower prices will be available on TrumpRx “early this year” and on Medicaid “in the coming months.” The administration has not yet released “full data” on expected personal savings, the spokesman added.
Stacy Dusetsina, a health policy professor at Vanderbilt University in Nashville, Tennessee, said that for people without insurance or those with high-deductible plans, TrumpRx could offer significant savings over list prices.
An estimated 26 million people in the U.S., or 8%, were uninsured in 2023. US Census Bureau.
But for most people with insurance, she said, buying drugs through the platform is unlikely to be the best option, especially brand-name drugs.
Even with lower prices, “usually we're talking hundreds of dollars per fill-up, and that ends up being a real problem for most people,” Dusetsina said.
Kubanski said even deep discounts may not make the drugs affordable for many patients paying out of pocket.
“A 50% discount on a $500 drug is nothing to sneeze at,” she said, “but many people would still have a hard time paying $250 out of pocket every month.”
Potential savings from extending MFN pricing to state Medicaid programs are even more difficult to estimate, Kubanski said, because details of the agreements have not been made public. And even if states pay less, Medicaid enrollees themselves won't see savings at the pharmacy.
“These deals will not provide savings to Medicaid enrollees because they already pay little or nothing for their drugs,” she said.
Caplan said Medicaid already pays the lowest drug prices in the United States. “It’s not clear where the money will be saved,” he said.
Drug manufacturers raise prices
Trump's efforts also come at the same time as a wave of price hikes by drug makers.
This year, drug companies have raised prices on more than 350 brand-name drugs. Reuters reports this.citing a study by 3 Axis Advisors, a healthcare consulting and research firm. The average price increase was about 4%, consistent with last year's price increase, the report said.
Frank of the Brookings Institution was skeptical of the agreements, saying it was possible the price cuts could be the result of discounts drugmakers were planning or already offering.
“If companies are choosing which drugs will be included in a deal, it's fair to assume they won't choose the ones that will have the biggest impact on revenue,” Frank said.
“Until we see that there is actually a real contract that actually obliges people to change prices, it's hard to say anything will happen,” he added. “It is not necessarily that the transactions are trivial, but rather that they are not reliable enough. In some cases, they may not be significant at all.”
At the same time, people's health insurance premiums have risen this year as subsidies under the Affordable Care Act expired and health insurers raised rates. It remains unclear whether Congress can work together to pass legislation to extend the tax breaks.
Dusetsina said if people can't pay for health insurance, it's unlikely they'll find prescription drugs even with discounts available.
“Affordability doesn’t seem affordable to a lot of people,” she said.
