The White House announced that nine additional drugmakers have agreed to sell selected drugs at significantly lower prices. The companies agreed to sell drugs to the Medicaid system for prices like those charged to other rich countries and to provide massive discounts to consumers paying cash through TrumpRx.gov. According to Barrons:
Nine companies participated in the latest round of deals. They are Sanofi, Novartis, Merck, GSK, Bristol Myers Squibb, Gilead Sciences, Amgen, Boehringer Ingelheim, and the Roche Holding subsidiary Genentech.
This comes in addition to deals made earlier with Novo Nordisk to sell Ozempic at reduced prices and other drug deals the White House announced earlier in 2025.
Background: When debating the Medicare Modernization Act of 2003, Republicans were adamant that creating Medicare Part D drug benefits should not lead to price controls. The government was expressly forbidden from negotiating prices, since the government supposedly has the power to demand the price it wants. At the time Republicans often claimed, the government does not negotiate, it mandates. However, health economist Alain Enthoven pointed out not long afterward that the only real power one party possesses in negotiations is to walk away from a deal. Medicare is unlikely to walk away from an effective drug and refuse to reimburse it. That just leaves outright price controls, i.e., legislating the price the government is willing to pay. To be an actual price control, drugmakers would have to lack the right to refuse and walk away, otherwise it is just a failed negotiation. In 2022 the Inflation Reduction Act allowed Medicare to negotiate prices of a handful of costly drugs. Republicans largely opposed the measure, arguing it created price controls that would reduce drug innovation.
Trump has no real authority in law to force price concessions on drugmakers, but drug companies presumably are afraid of what might come next if they refuse to work with the administration. Or maybe drugmakers only agreed to deep discounts on drugs that were facing competition like Novo Nordisk and its drug Ozempic (semaglutide). Since agreeing to sharp discounts on Ozempic, Novo Nordisk has applied to up the FDA-approved Ozempic dose. It also applied for a new drug application (NDA) with the FDA to combine semaglutide with cagrilintide, a synthetic hormone that regulates appetite. Perhaps Novo Nordisk is offering a deal on last year’s model because a new and improve drug is on the way.
Republicans mostly support President Trump’s strong-arm drug negotiations. It makes one wonder what changed? Could it be, for instance, that drugmakers have been too aggressive at raising prices and lawmakers are tired of it? It could be that it is a Republican president doing the negotiations. Republicans may realize they have little choice in the matter. Or maybe it is because strong arm negotiations are not price controls in law. Rather, these are negotiations with the White House that drugmakers are not obligated to follow.
That begs the question: why didn’t past administrations play hardball with drug companies? There are numerous ways to put downward pressure on drug prices. For instance, allowing insurance companies (and Medicare/Medicaid) additional authority to decline to reimburse some drugs if the value is low is the same as walking away without a deal. Another is for the patent office to get rid of defensive drug company patent thickets. Yet another would be to further speed generic approval once patents have expired. Finally, regulations against drug reimportation is what allows drug companies the ability to charge different prices in different countries (i.e., price discrimination). All these regulations (mentioned above) have valid reasons to exist, but they could be examined and adjusted to some degree. If nothing else, threat of action could be used as leverage.
Read more at WSJ: More Drugmakers Reach Deals With White House to Lower Prices
Barrons: White House cuts drug-pricing deals with pharma companies, tilting system toward self-pay
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