Trump and Pfizer Strike Deal to Lower Pharmaceutical Drug Prices
- Sofia Castaneda
- 2 hours ago
- 3 min read
On September 30, 2025, President Trump announced that the U.S. government had signed an agreement with Pfizer, one of the world’s leading pharmaceutical manufacturers, to lower the prices of prescription drugs through a most-favored-nation policy and promoting direct-to-consumer sales. The agreement intends to dramatically reduce the market prices of pharmaceuticals, in some cases “by 1000%”, according to Trump during his address.
The executive order comes during a year where drug prices in the United States have peaked. A recent analysis shows that prices for newly launched drugs have more than doubled from 2021 to 2023, yet high pharmaceutical prices are a uniquely U.S. problem. Research has shown that consumers in the U.S. pay two to four times more than consumers in developed foreign countries for name-brand prescription drugs. Pharmaceutical companies like Pfizer collect more than half of total annual revenue from the U.S. consumer base, despite the U.S. only consuming 13% of the world’s prescription drugs. The most influential factor in this discrepancy is that prescription drug prices in the U.S. are set directly by the manufacturers. In other developed countries, such as France, Sweden, and the United Kingdom, the federal government has some control over what prices manufacturers are allowed to sell their drugs at, and these prices tend to be much lower than those in the U.S.
This is what led the Trump Administration to utilize the policy of most-favored-nation (MFN) pricing, which allows companies to sell their drugs at the lowest price charged for the same drug in other developed countries. For example, Pfizer’s most profitable drug, a blood thinner called Eliquis, is sold at an annual price of about $1,000 in Japan, but the annual price in the U.S. has reached $7,000 as of 2024. An MFN policy would limit the price at which Eliquis could be sold in the U.S. market to $1,000.
This MFN policy is the focal point of the agreement announced between the U.S. government and Pfizer on September 30. This agreement also promotes direct-to-consumer sales of drugs through a government-sponsored website TrumpRx (trumprx.gov), which “doesn’t sell medications”, but allows consumers to input their medications and find the lowest price for purchase. The website is set to be fully functional in early 2026.
TrumpRx has already received criticism, most notably since the website only serves to benefit the 8% of the U.S. population who does not have health insurance. Everyone else will be left to pay rates negotiated by insurance companies based on the new lower market prices for drugs.
In addition, the agreement offers Pfizer significant fiscal and public relations benefits. President Trump made a statement in September saying he intends to impose a 100% tariff on imported pharmaceutical products. Pharmaceutical companies have increased incentive to comply with the President’s America First Trade Policy. The agreement also states that Pfizer must grant every state’s Medicaid program in the country access to MFN Pfizer products, guaranteeing the company an advantage over other pharmaceutical companies in gaining large, stable contracts with state governments. Lastly, Pfizer CEO Albert Bourla’s public image has been markedly supported by the contract. In a statement, Health Secretary Robert F. Kennedy Jr addressed that Bourla had “created a template for corporate responsibility for putting public health ahead of his individual interests.”
Amidst a federal government shutdown over disagreements on health care funding, the Trump administration’s deal with Pfizer signifies a step towards reducing health care prices for all Americans, a pressing issue across party lines. As of October 10, 2025 competitor AstraZeneca has also committed to adopting the MFN pricing model. The coming year will demonstrate whether more companies will accept the model, marking a turning point in U.S. pharmaceutical pricing.
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