Last month, the Trump administration published an executive order requiring a 30-day government negotiation with drug companies to bring prices in line with those paid by other developed nations, otherwise known as Most Favored Nation (MFN) pricing. If this process did not lead to significant progress toward MFN prices by June 11, government agencies were directed to pursue additional actions. Most notably, the Secretary of the Department of Health & Human Services was directed to propose a rulemaking plan to implement MFN pricing.
A week later, the Trump administration provided more detail, indicating that all brand-name drugs marketed in the U.S. without generic or biosimilar competitors were to be sold in the U.S. at the MFN price, which it described as the lowest price offered in an Organization for Economic Co-operation & Development (OECD) country whose per capita gross domestic product (GDP) is 60% or more of the U.S. per capita GDP. If drug companies do not agree to this price voluntarily, the administration said the government will take action to force them to do so.
The June 11 deadline has come and gone, and no details have been released by the Trump administration as to whether drug companies have opted to negotiate or if the government will implement any enforcement action. If the government takes enforcement action, it will effectively be a revival of the MFN policy that was implemented by the first Trump administration in December 2020, but with a few changes. For example, the original policy focused on Part B and Part D drugs; the revived policy, if implemented, will focus on the commercial market.
The 2020 MFN policy was strongly and successfully opposed by the ACR and partner organizations on the grounds that provider reimbursement at “Most Favored Nation” rates would not be enough to cover the cost of acquiring and administering many of the therapies most frequently administered by rheumatologists and thus would lead many of them to operate at a loss or turn away patients. The policy was rescinded by the Biden administration in 2021.
The ACR will continue to actively monitor this development and respond as new details emerge on the policy’s potential implementation and impact on rheumatologists and their patients. The ACR is committed to ensuring drug prices are adequately reduced and that rheumatologists are reimbursed fairly for procuring and infusing various therapies.
For further information about the ACR’s advocacy efforts, email the ACR’s advocacy team at [email protected]. ACR/ARP members can also schedule time to meet with the ACR’s advocacy team to discuss issues and challenges you are facing.
