Latest news with #drugmakers
New York Times
an hour ago
- Business
- New York Times
Trump Demands That Drugmakers Lower Some of Their U.S. Prices by September
President Trump on Thursday sent letters to 17 of the world's biggest drugmakers demanding that they reduce some of their U.S. prices to the much lower levels they charge other wealthy countries by late September. Despite the strong language in the letters, which the administration posted on social media, Mr. Trump's demands amount to a request that drug companies act voluntarily: His administration has not put forward a clear legal authority to compel them to lower their prices. Still, he wrote, 'If you refuse to step up, we will deploy every tool in our arsenal to protect American families from continued abusive drug pricing practices.' Since Mr. Trump issued an executive order in May asking drugmakers to lower their prices, many companies have submitted proposals to the administration to try to reach a truce. In the letters, the president called most of those proposals inadequate, saying they were 'shifting blame and requesting policy changes that would result in billions of dollars in handouts to industry.' Mr. Trump's new 15 percent tariffs on imported medicines from Europe, which could go into effect as soon as sometime in August, could further complicate his efforts to lower drug prices. The tariffs would add billions in import charges for the largest drug companies, which make many of their biggest blockbusters in Europe. The levies, in turn, may lead companies to raise drug prices for American patients, government programs and employers. In the letters, Mr. Trump insisted that U.S. drug prices must be reduced to the lowest prices they charge in a peer country — a 'most favored nation' pricing model — for 'every single' patient covered by Medicaid, the government insurance program for low-income and disabled Americans. (Medicaid already gets lower prices than other American payers.) He demanded the same for 'all new drugs' across both government and commercial insurance, suggesting that drugs already on the market, other than for Medicaid, would be exempt. Want all of The Times? Subscribe.
CNN
3 hours ago
- Business
- CNN
Frustrated with continued high drug costs, Trump demands 17 companies lower prices in 60 days
President Donald Trump is ratcheting up the pressure on major drugmakers to bring their US prices in line with the far lower ones available to patients in other countries. Trump sent letters to 17 major pharmaceutical company CEOs on Thursday with a list of demands, including that the manufacturers extend so-called 'Most Favored Nation' pricing — the lowest price paid for a drug in a peer country — to all drugs provided to Medicaid enrollees. He also wants the companies to guarantee that Medicaid, Medicare and commercial-market insurers pay such prices for all new drugs. The president gave the companies 60 days to comply. The directive stems from an executive order Trump signed in May, when he demanded drugmakers start offering US patients those lower prices or face consequences. Prices for some brand name drugs in the US are more than three times those in other developed nations, according to the administration. In that executive order, he also directed the Department of Health and Human Services to come up with price targets within 30 days. But Trump implied that the discussions between HHS officials and the companies did not yield acceptable results. 'Most proposals my administration has received to 'resolve' this critical issue promised more of the same: shifting blame and requesting policy changes that would result in billions of dollars in handouts to industry,' he wrote in the letters, which were posted on Truth Social. 'Moving forward, the only thing I will accept from drug manufacturers is a commitment that provides American families immediate relief from the vastly inflated drug prices and an end to the free ride of American innovation by European and other developed nations.' 'But if you refuse to step up, we will deploy every tool in our arsenal to protect American families from continued abusive drug pricing practices,' he continued. 'Americans are demanding lower drug prices, and they need them today.' The May executive order outlined some potential ramifications if manufacturers do not make significant progress in lowering prices. Those included directing HHS to craft a rule implementing the policy, allowing more drug importation into the US, reviewing drug exports, and having the Food and Drug Administration modify or revoke approvals granted for drugs that may be 'unsafe, ineffective, or improperly marketed.' The Pharmaceutical Research and Manufacturers of America, the industry's main trade association, did not immediately return a request for comment. The stock prices for several of the companies that received the letters, including Eli Lilly, Merck, Johnson & Johnson, GSK and Amgen, slipped between 1% to 4% in mid-afternoon trading. The S&P 500 Pharmaceuticals Industry Index was down a little more than 2%. It's unclear what authority the president has to demand certain prices, particularly in the private market and without Congress' involvement. Some industry experts have described the May executive order as more bark than bite. Trump's effort to establish a 'Most Favored Nation' rule for certain drugs in Medicare during his first term was quickly blocked by federal courts for procedural reasons before being rescinded by then-President Joe Biden in 2021. The May executive order goes far beyond that measure since it is not limited to drugs purchased by Medicare nor to a certain number of pharmaceuticals. In the letters, Trump also demanded that drug companies return revenue from operations abroad to lower prices in America through 'an explicit agreement with the United States.' Plus, he ordered the manufacturers to participate in programs to sell certain drugs directly to consumers or business at 'Most Favored Nation' prices. Drugmakers have long complained that foreign governments, which are more involved in price setting, demand very low prices to gain access to their markets. It's not the only way the Trump administration is squeezing drugmakers — officials have also looked to impose tariffs on pharmaceutical imports, which had been exempted from such levies enacted during the president's first term. The tariffs could exacerbate shortages of certain drugs, particularly generic medicines, and eventually raise prices, experts have warned.
CNN
3 hours ago
- Business
- CNN
Frustrated with continued high drug costs, Trump demands 17 companies lower prices in 60 days
President Donald Trump is ratcheting up the pressure on major drugmakers to bring their US prices in line with the far lower ones available to patients in other countries. Trump sent letters to 17 major pharmaceutical company CEOs on Thursday with a list of demands, including that the manufacturers extend so-called 'Most Favored Nation' pricing — the lowest price paid for a drug in a peer country — to all drugs provided to Medicaid enrollees. He also wants the companies to guarantee that Medicaid, Medicare and commercial-market insurers pay such prices for all new drugs. The president gave the companies 60 days to comply. The directive stems from an executive order Trump signed in May, when he demanded drugmakers start offering US patients those lower prices or face consequences. Prices for some brand name drugs in the US are more than three times those in other developed nations, according to the administration. In that executive order, he also directed the Department of Health and Human Services to come up with price targets within 30 days. But Trump implied that the discussions between HHS officials and the companies did not yield acceptable results. 'Most proposals my administration has received to 'resolve' this critical issue promised more of the same: shifting blame and requesting policy changes that would result in billions of dollars in handouts to industry,' he wrote in the letters, which were posted on Truth Social. 'Moving forward, the only thing I will accept from drug manufacturers is a commitment that provides American families immediate relief from the vastly inflated drug prices and an end to the free ride of American innovation by European and other developed nations.' 'But if you refuse to step up, we will deploy every tool in our arsenal to protect American families from continued abusive drug pricing practices,' he continued. 'Americans are demanding lower drug prices, and they need them today.' The May executive order outlined some potential ramifications if manufacturers do not make significant progress in lowering prices. Those included directing HHS to craft a rule implementing the policy, allowing more drug importation into the US, reviewing drug exports, and having the Food and Drug Administration modify or revoke approvals granted for drugs that may be 'unsafe, ineffective, or improperly marketed.' The Pharmaceutical Research and Manufacturers of America, the industry's main trade association, did not immediately return a request for comment. The drug prices for several of the companies that received the letters, including Eli Lilly, Merck, Johnson & Johnson, GSK and Amgen, slipped between 1% to 4% in mid-afternoon trading. The S&P 500 Pharmaceuticals Industry Index was down a little more than 2%. It's unclear what authority the president has to demand certain prices, particularly in the private market and without Congress' involvement. Some industry experts have described the May executive order as more bark than bite. Trump's effort to establish a 'Most Favored Nation' rule for certain drugs in Medicare during his first term was quickly blocked by federal courts for procedural reasons before being rescinded by then-President Joe Biden in 2021. The May executive order goes far beyond that measure since it is not limited to drugs purchased by Medicare nor to a certain number of pharmaceuticals. In the letters, Trump also demanded that drug companies return revenue from operations abroad to lower prices in America through 'an explicit agreement with the United States.' Plus, he ordered the manufacturers to participate in programs to sell certain drugs directly to consumers or business at 'Most Favored Nation' prices. Drugmakers have long complained that foreign governments, which are more involved in price setting, demand very low prices to gain access to their markets. It's not the only way the Trump administration is squeezing drugmakers — officials have also looked to impose tariffs on pharmaceutical imports, which had been exempted from such levies enacted during the president's first term. The tariffs could exacerbate shortages of certain drugs, particularly generic medicines, and eventually raise prices, experts have warned.
Malay Mail
3 days ago
- Business
- Malay Mail
AstraZeneca beats Q2 forecasts on booming US drug sales, eyes US$80b revenue by 2030
LONDON, July 29 — AstraZeneca Tuesday beat second-quarter revenue and profit expectations on robust sales of newer cancer, heart and kidney disease medicines and strong demand in the US, where it has invested US$50 billion (RM212 billion) to expand amid tariff threats from Washington. The performance is a boost for the UK's largest-listed company by market value as the wider sector braces for US tariffs on pharmaceutical imports and navigates pressure after President Donald Trump's order pushing for drugmakers to cut US prices to what other countries pay. AstraZeneca shares rose as much as 2.2 per cent by 0813 GMT. The drugmaker in April forecast only a limited impact from potential US tariffs, adding it would be able to meet its annual outlook if the levies on European imports were similar to those in other industries. A European Union-US trade deal over the weekend will result in a 15 per cent tariff on pharmaceuticals from the region. The US accounted for more than 40 per cent of AstraZeneca's revenue in 2024. The company had prioritised the market — the world's largest, worth US$635 billion — even before Trump's return to office. AstraZeneca is betting on a wave of expected launches of 20 new medicines and its US expansion to reach US$80 billion in annual revenue by 2030 and offset generic competition. On Tuesday, it maintained its 2025 outlook and increased its interim dividend by 3 per cent. 'Our strong momentum in revenue growth continued through the first half of the year and the delivery from our broad and diverse pipeline has been excellent,' CEO Pascal Soriot said. Cancer drugs outperform Sales of oncology drugs, constituting nearly half of AstraZeneca's revenue, were up 18 per cent at US$6.31 billion at constant currency rates in the quarter. Jefferies analysts said sales of drugs including Tagrisso, Lynparza, Calquence, Truqap and Imfinzi beat expectations. Total revenue for the three months ended June grew 11 per cent to US$14.46 billion, with double-digit growth in the US despite headwinds from changes in US Medicare price negotiations. Core earnings stood at US$2.17 per share. That compares with analysts' expectations of US$2.16, and US$14.15 billion in sales, according to a company-provided consensus. 'Operationally, this is the type of quarter we want to see,' Barclays analysts said. AstraZeneca is also hoping to move on from scandals in its second-biggest market, China, where it this year faced minor fines related to cancer drugs. It is also fighting patent challenges from an individual against Tagrisso. The company also delayed late-stage Avanzar trial data for a key lung cancer treatment to the first half of 2026. — Reuters
New York Times
3 days ago
- Business
- New York Times
Tariffs on Medicines From Europe Stand to Cost Drugmakers Billions
The trade deal reached between the United States and the European Union on Sunday will impose a 15 percent tariff on imported medicines from Europe. Drugmakers manufacture some of their biggest and best-known blockbusters there, including Botox, the cancer medication Keytruda and popular weight-loss drugs like Ozempic. The tariff rate is much lower than the levies of up to 200 percent that President Trump had threatened. Still, the new import costs stand to add billions of dollars in expenses for the drug industry and could lead to price increases for some medicines. That could translate into higher out-of-pocket costs and higher health insurance premiums for Americans. The 15 percent rate is final and will not be affected by the national-security-related tariffs that Mr. Trump is expected to impose on pharmaceuticals made elsewhere in the world, according to a White House official and senior European Commission officials. This outcome is something of a win for the pharmaceutical industry, which had feared that drugs from Europe would be hit with high levies related to national security. Both sets of pharma tariffs are expected to take effect simultaneously sometime next month, officials said. The pharmaceutical industry depends on a complex global supply chain: Production of most medications happens in multiple countries, with plants around the world handling different stages of the process. Europe is perhaps the most important piece of the global network that produces brand-name drugs — those with patent protection and typically high prices and fat profit margins. Pharmaceutical products are Europe's No. 1 export to the United States. European officials have expressed worries in recent months that pharma tariffs could prompt drugmakers to pull back on investments, at the expense of jobs, factories and tax revenue. Ireland in particular has become a pharma manufacturing hub, in part because doing business there helps drug companies lower their overall tax bills. Nearly all of the largest drugmakers have factories there. Last year, Ireland sent the United States $50 billion worth of pharma products, most of which were made by multinational drug companies. Europe manufactures the active ingredients for 43 percent of the brand-name drugs consumed in the United States, according to U.S. Pharmacopeia, a nonprofit that tracks the drug supply chain. No other region produces a greater share. Europe also makes active ingredients for 18 percent of the generic drugs taken in the United States, which have lower prices and account for a vast majority of Americans' prescriptions. Certain generic drugs made in Europe will be exempt from the new tariff, Ursula von der Leyen, president of the European Commission, said on Sunday. The White House and the European Commission did not respond to requests for comment on which generic drugs would be exempt. The threat of tariffs on generic medicines, which have thin margins, has raised concerns about exacerbating shortages. Experts who track pharmaceutical supply chains said they were not worried that brand-name drugs produced in Europe would go into shortage because they have such high profit margins. The new tariffs will be paid by drugmakers importing finished products or ingredients into the United States. Many are expected to try to pass at least some of the costs along to employers and government programs like Medicare that cover most of the tab for Americans' prescription drugs. Patients whose insurance requires them to pay a deductible or a percentage of a drug's price could eventually face higher out-of-pocket costs for some drugs. In some cases, however, contractual agreements and the threat of steep financial penalties may deter manufacturers from sharply raising prices. Some health insurance premiums are already set to rise. Insurers in New York, Oregon and Maryland recently told regulators that tariffs were prompting them to seek higher premium increases next year for certain health plans than they otherwise would have. The pharmaceutical industry has lobbied fiercely against the tariffs, saying that drugmakers could spend less on research and manufacturing in the United States as a result. 'Tariffs are not the answer for promoting greater domestic production of these products,' the drug industry's main lobbying group, PhRMA, said in a statement in May. For months, Mr. Trump has been promising to impose punishing tariffs on imported pharmaceuticals. His goal, he has said, is to bring more manufacturing back to the United States. In April, the Trump administration opened an investigation into whether imports of medicines and pharmaceutical ingredients threatened America's national security. Mr. Trump brought the inquiry under a legal authority known as Section 232, which he has used to justify tariffs on cars and other industries. With medicines from Europe exempt from Section 232 tariffs, those levies now threaten two of the other most important regions in the drug industry's global production network: India and China, both of which focus on generic drugs. India has been negotiating a trade deal that could address its giant generic drug industry and avert national-security-related tariffs from the United States. Ana Swanson and Jeanna Smialek contributed reporting.
