On Tuesday, after months of relentless lobbying and schmoozing from pharmaceutical executives at Mar-a-Lago, President Trump signed an executive order that will pad the pockets of big drug companies and raise seniors’ drug prices. His executive order sells out seniors, goes back on his promises to lower drug costs, and hands pharmaceutical companies exactly what they want. While big drug companies can afford to lose $1 trillion in revenue over a decade and still remain the most profitable industry in the world, seniors cannot afford President Trump’s drug price hikes. The reality of Trump’s executive order directly contradicts numerous headlines published this week.

Here’s the truth about President Trump’s latest executive order: 

The Executive Order Is A Huge Giveaway To Big Drug Companies:

  • The executive order aims to delay Medicare from negotiating lower prices for drugs that make up 58 percent of the market, including high-cost lifesaving drugs such as cancer treatments.
  • Delaying Medicare from negotiating lower prices for small molecule drugs for an additional four years is a top lobbying priority of big drug companies, and will cost seniors and taxpayers billions. Voters across all political parties want Congress to expand Medicare negotiation to more drugs on a faster timeline. 
  • The executive order is aimed at helping drug companies escape negotiations and continue to pad their multibillion dollar profits, long after they’ve recouped their research and development costs.
  • If this policy was a part of the original Inflation Reduction Act, seniors would not be able to expect savings on more than half of the drugs that have been selected for lower, negotiated prices. The lower prices on these drugs are expected to save seniors $1.5 billion and taxpayers $6 billion in the first year alone. If this giveaway to pharma is made law, it will cost seniors and taxpayers billions.
  • The executive order is a culmination of nearly $1 billion spent on lobbying by pharmaceutical companies since 2022 in an effort to weaken the Inflation Reduction Act’s measures to lower drug prices.

The Executive Order Does Nothing To Lower Drug Prices:

  • The executive order is nothing but a distraction from Republican efforts to rip away health coverage and hike health care costs while handing out tax breaks to corporations.
  • Instead of going after high drug prices, the policy areas outlined in the executive order harken back to Trump’s failed attempts to lower drug prices in his first term. They largely focus on addressing the role of middlemen like pharmacy benefit managers (PBMs), hospitals, and 340B providers, which will do nothing to limit drug companies’ ability to set high drug prices. 
  • The executive order also relies on importing drugs with lower prices from foreign countries, which Trump started in his first term and has yet to deliver lower cost drugs to patients. 
  • The executive order encourages the development of generic and biosimilar drugs to lower drug prices through competition, but weeks before the executive order was issued, the administration closed the FDA office tasked with accelerating generic drug approvals, which is already slowing drug development. The development of new drugs is also hampered by the Trump administration’s reckless and damaging cuts to the National Institutes of Health, whose funding has supported the development of 99 percent of new drugs released in the last decade.

Trump Has Already Taken Many Actions This Term To Increase Americans’ Drug Prices:

  • Trump is trying to hand out massive tax breaks to big drug companies.
  • Trump eliminated the FDA office tasked with speeding approvals of cheaper generic drugs.
  • Trump eliminated a Biden-era program that would allow seniors to purchase generic drugs for just $2.
  • Trump is also trying to keep affordable drugs out of the hands of patients by revoking a Biden-era policy to require Medicare coverage for anti-obesity drugs. 
  • Trump plans to gut discretionary funding for the implementation of the Inflation Reduction Act, a law that is lowering drug costs for people with Medicare and cracks down on drug companies’ price gouging.
  • Trump’s current plans to add massive tariffs to drugs and drug ingredients imported from abroad will increase drug costs for Americans and lead to drug shortages. 

In His First Term, Trump Cut Drug Companies’ Taxes And Achieved Nothing To Lower Drug Costs:

  • President Trump’s “efforts” to lower drug costs were nothing more than smoke and mirrors while drug prices skyrocketed during his first term. 
  • Trump cut drug companies’ rate by 40 percent and provided incentives for them to move their profits abroad. 

During his first term, Trump was full of populist rhetoric and splashy media announcements, but all of his major drug pricing proposals were total failures: 

  • Trump failed to implement the state-sponsored prescription drug importation plan he proposed (which was so cumbersome it wouldn’t have provided timely relief to those who need it);
  • Trump failed to implement his Medicare Part B international reference pricing plan (it was so poorly conceived it was stopped in court); and 
  • Trump’s reforms to the Medicare Part D rebate system never went into effect (they were a giveaway to drug companies and would have resulted in huge Medicare premium increases and increased government spending). 
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