BIO came out against the drug price control provisions outlined in the Most Favored Nation (MFN) Executive Order that President Trump signed yesterday.
What it would do: Among other provisions, the Executive Order directs government agencies to ensure drug prices in the U.S. are no higher than prices in other developed countries. “Should drug manufacturers fail to offer American consumers the most-favored-nation lowest price, my Administration will take additional aggressive action,” the order says.
BIO’s reaction: “Most favored nation is a deeply flawed proposal that would devastate our nation’s small- and mid-size biotech companies—the very companies that are the leading drivers of medical innovation in the United States and the cornerstone of America’s biotechnology leadership,” said a statement from BIO President & CEO John F. Crowley.
Why it matters: “Importing socialized medicine will not make Americans healthier or our economy stronger. It will only serve to empower China and our other adversaries and undermine our economic and national security,” Crowley says.
The big picture: More than 100 new drugs approved over the past five years are available in the United States but not in Europe, largely because of European price controls. And a study supported by the Council of State Bioscience Associations (CBSA) found that linking drug prices in the U.S. to prices paid in other countries would lead to a huge reduction in new medicines coming to the market. Alternately, a 2023 study found that if just five countries—Japan, Germany, France, UK, and Italy—paid their fair share, the world would gain 12 new drugs annually.
The bottom line: “Researchers that spend years developing cures and breakthrough treatments are being penalized and the U.S. is falling behind in the 21st century biotech race,” said Crowley. “Meanwhile, U.S. medication prices prop up middlemen that prevent cost savings from being passed on to patients. The solution is investments that ensure the U.S. continues to lead the world in medical innovation, and policies that simplify the system.”
What's next: While it remains to be seen exactly how it will be implemented, the EO outlines several steps, including establishing price targets within 30 days, proposing rulemaking for pricing if significant progress is not made, and potentially taking action to import lower-cost drugs from developed nations.
Read BIO’s full statement.
