Trump Administration Secures Landmark Drug Pricing Agreements with Nine Pharmaceutical Giants

Dec 20, 2025 22:56 CST Updated 22:56

Johnson & Johnson

Medical Device R&D and Manufacturer

On Friday, the 19th, U.S. President Trump announced agreements with nine pharmaceutical giants to lower drug prices. The series of agreements, in which drug companies reduce prices on some U.S. medications in exchange for a three-year tariff exemption, have made the latest progress. Under the new agreements, the nine pharmaceutical companies—including Merck, Genentech (a subsidiary of Roche), Novartis, Bristol-Myers Squibb, Gilead Sciences, Boehringer Ingelheim, Amgen, GlaxoSmithKline, and Sanofi—have committed to lowering drug prices for the Medicaid program, which serves low-income and disabled individuals, selling discounted drugs directly to consumers, and offering drugs in the U.S. at the same prices as in overseas markets.New drug development.This marks that since Trump issued a "60-day ultimatum" to 17 top pharmaceutical companies this July, 14 of them have accepted the government's price reduction request, leaving only AiBiovie, Johnson & Johnson, and Regeneron are still in negotiations.Trump has already signaled: Johnson & Johnson to officially announce joining next week. UpperMonths Trump andNovo Nordisk and Eli Lilly Reach Agreement to Significantly Reduce Prices of GLP-1 Weight Loss DrugsGrid.

The core logic of Trump administration's push for drug price reform is the "most-favored-nation price" principle.According to the agreement, these pharmaceutical companies must reduce drug prices in the U.S. market to levels comparable to other developed countries and implement a "same price inside and outside the U.S." policy for newly launched drugs.Specifically, pharmaceutical companies need to offer the most-favored-nation price to Medicaid patients, ensure the most-favored-nation price when new drugs are launched, and pressure other countries to raise drug prices through trade policies, repatriating overseas profits to the U.S. to lower domestic drug prices.

From the core terms of the agreement, it mainly includes four aspects: First, the price adjustment mechanism, pharmaceutical companies must offer discounts on drug prices for low-income and disabled individuals covered by the Medicaid program, with discounts on some drugs reaching as high as 80%-90%.Second, the new drug pricing rule: the initial launch price of all newly marketed drugs in the U.S. must not exceed that in other affluent countries.Third, the reform of sales channels requires pharmaceutical companies to sell medicines directly to consumers at discounted prices on the TrumpRx platform.Fourth, production investment commitment: pharmaceutical companies participating in the agreement pledge to invest at least $150 billion in the United States for expanding production and research and development.

Notably, these agreements also encompass clauses related to supply chain security.According to the agreement, companies such as Merck, Bristol-Myers Squibb, and GlaxoSmithKline agreed to donate a six-month supply of critical active pharmaceutical ingredients to the U.S. Strategic API Reserve (SAPIR) and pledged to manufacture finished drugs in emergency situations.This arrangement not only ensures the safety of the U.S. drug supply but also provides conditions for pharmaceutical companies to receive government support in emergencies.

BMS: From January 2026Starting from the 1st day, Eliquis(apixaban) is provided free of charge to Medicaid, reducing costs for patients and the healthcare system. Over 7 tons of Eliquis API were donated to the U.S. government or taxpayers without charge to fill the U.S. Strategic Active Pharmaceutical Ingredient Reserve. New drugs are launched in developed countries with a more balanced pricing approach. Patients paying in cash can directly access Sotyktu® (deucravacitinib), Zeposia® (ozanimod), Reyataz® (atazanavir), Baraclude® (entecavir), and Orencia® SC (abatacept), allowing these essential medications to be obtained at approximately an 80% discount off the current list price. The specific terms of the agreement remain confidential. Additionally, as part of BMS’s commitment earlier this year to invest $40 billion in the U.S. over the next five years, the company will continue to expand domestic production in the U.S. to support additional outsourcing of BMS pharmaceuticals both domestically and internationally. BMS will receive a three-year tariff exemption and will not be subject to future pricing regulations.

MSD: PlanThroughDirect-to-patient programs that provide critical products to eligible patients in the U.S. at an affordable price. Currently includes JANUVIA.(Sitagliptin)JANUMET (Sitagliptin/Metformin)and JANUMET XR (Sitagliptin/Metformin Hydrochloride Sustained-Release Tablets)，In oral PCSK9 inhibitorsEnlicitideApproved by the U.S. FDAAfter,And will be provided to eligible Americans at an affordable price through a direct-to-patient program.。JANUVIA, JANUMET, and JANUMET XR will be offered to eligible U.S. patients at a cash price (approximately 70% of the current list price) through a direct-to-patient program.Supply.Has committed to investing over 70 billion US dollars in the United States to promote American production and innovation.

Genentech(Roche):Recently announced an investment of $50 billion in manufacturing, infrastructure, and R&D in the United States.Will also expand its recently launchedBasic Information for PatientsInfluenza drug project, and throughTrumpRx.govProvide this project.Genentech's commitment includes offering many of its drugs, including those for serious and complex diseases, as part of Medicaid for the most vulnerable patients in the U.S. at prices comparable to other wealthy nations.

Gilead: Discounts on certain existing drugs in the U.S. Medicaid program, similar to payments in comparable developed countries, including specific drugs for treating HIV, hepatitis C, hepatitis B, and COVID-19. Future drug pricingOn par with other key developed countries. Launch the direct-to-patient program, allowing prescription holders to access the hepatitis C cure Epclusa at a discounted cash price.GileadEpclusa will be provided through TrumpRx.gov, and American patients can directly access it.GileadDirect-to-Patient Program Connection.

^{With U.S. BusinessThe Ministry of Commerce reached an agreement to exempt tariffs on drugs under Section 232 for three years, on the condition that Gilead continues to invest in U.S. manufacturing.Will invest $32 billion in manufacturing, R&D, and infrastructure construction in the United States over the next five years.}

^{Boehringer Ingelheim: Plans to Invest $10 Billion by 2028 to Expand Its Pharmaceutical R&D and Manufacturing Operations in the U.S.Will allow American patients to purchase at a significant discount.}

^{Amgen: Announces Additional $2.5 Billion in U.S.-Based Capital Investment.Amgen to Expand Its Direct-to-Patient ProgramAmgenNow™, including Aimovig (erenumab-aooe) and Amjevita（adalimumab-atto). Both will be offered at a monthly discount price of $299, which is nearly 60% and 80% lower than the current U.S. pricing, respectively.October 2025, the company launched AmgenNow and made Repatha (evolocumab) available to U.S. patients at a price of $239 per month, nearly 60% lower than the current U.S. market price. The program is open to all eligible patients, including those without insurance, with high-deductible health plans, or who prefer to pay in cash or out-of-pocket. These three drugs will also be available through TrumpRx.gov.}

^{PromiseNovartis: In 2026, Novartis will provide more Novartis drugs through its direct-to-patient platformMayzent (siponimod), Rydapt (midostaurin), and Tabrecta(capmatinib)DevelopmentDirect-to-patient platform. These new platforms will be served through TrumpRx. Apply to participate in GENEROUS(The U.S. Medicaid Cost Reduction) model, aimed at further improving the accessibility of medicines in the U.S. Medicaid program.Within five yearsInvestment of $23 billion, expanding its R&D and manufacturing infrastructure in the United States.}

^{Sanofi:Will ensure that Medicaid programs in various states can access certain Sanofi drugs at the same prices as other high-income countries. This will reduce the average cost of certain medications for treating diabetes, cardiovascular and neurological diseases, and cancer by 61%. Sanofi will also offer consumers lower-cost drugs through TrumpRx.gov and other direct-to-patient platforms, with average savings of nearly 70% on certain treatments for infections, cardiovascular conditions, and diabetes.0%. On the basis of the announced $20 billion investment plan, including upgrading existing manufacturing facilities, building new supply capabilities, and expanding manufacturing cooperation.}

GSKGSK:Reduce the price of prescription drugs for American patients, including GSK's extensive respiratory product portfolio.Combined, this product is used to treat more than 40 million Americans suffering from respiratory conditions such as asthma and chronic obstructive pulmonary disease (COPD).will also provide most of the inhaled respiratory product portfolio and other products to patients through the direct purchasing platform, achieving up to 66%Save.Invest over 30 billion US dollars in R&D and manufacturing in the United States within the next five years.

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