Pfizer strikes deal with Trump administration to cut US drug prices

Donald Trump, president of the United States, has made a deal with US drugmaker Pfizer to lower the cost of the Medicaid program’s prescription medications.

Pfizer agreed to sell its current medications to Medicaid patients at the lowest price offered in other developed nations and signed a deal with the Trump administration that was signed on Tuesday. The deal also stipulated that it would pay the same price as new drugs to be launched in the US.

According to research, US consumers pay more than three times as much for brand-name medications as those in other wealthy nations.

Additionally, the company consented to participate in a new website called TrumpRx, which will allow users to purchase medications directly from manufacturers. Pfizer stated that the platform will offer a significant discount on many of its treatments, on average, at about 50%.

The agreement with Pfizer builds on an executive order that Trump signed in May, which sets a deadline for drug manufacturers to choose whether to cut costs or put new cap on what the government will pay. Trump claimed that negotiations would take place over the course of the following week.

Senior administration officials told The Associated Press news agency that consumers won’t start seeing lower prices as a result of the Pfizer deal until 2026.

Trump said Pfizer agreed to spend $70 billion on domestic manufacturing facilities, making it the latest top drug manufacturer to make its announcement to start building production in the US.

The investment was not immediately disclosed by the White House, but Pfizer stated in a statement that the money would be used for US research, development, and capital projects in the coming years.

Trump has been discussing the need to lower drug prices and boost US drug production for months, and on September 25, he announced that he would impose a 100 percent tariff on imported branded or patented pharmaceutical products starting on October 1 unless drug manufacturers set up manufacturing facilities there.