In a bold move that has sent shockwaves through the pharmaceutical industry, President Donald J. Trump announced an Executive Order on May 11, 2025, aimed at drastically reducing prescription drug prices in the United States by 30% to 80%. The order, which introduces a “Most Favored Nation” policy, mandates that the U.S. pay the lowest price for drugs available in any other nation, addressing what Trump described as decades of unfair pricing practices by Big Pharma. Posted on Truth Social, Trump’s announcement criticized pharmaceutical companies for charging Americans “five to ten times more” for drugs produced in the same facilities as those sold abroad, blaming excessive campaign contributions and weak past leadership.
This policy builds on Trump’s earlier efforts, including his 2020 executive orders to lower drug prices and his recent April 2025 order to enhance Medicare price negotiations and promote domestic manufacturing. The new order, however, is unprecedented in scope, promising immediate price cuts and long-term savings projected in the trillions. Social media erupted with reactions, with supporters praising the move as a win for American consumers, while critics, including some Democrats and industry insiders, warned of potential disruptions to innovation and supply chains.
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Big Pharma’s Potential Responses
The pharmaceutical industry, particularly giants like Moderna, Pfizer, and Johnson & Johnson, faces significant financial and strategic challenges. Based on recent industry reactions and historical patterns, here are likely responses:
Legal Challenges and Lobbying Pushback:
Big Pharma has a history of fighting price controls. In 2020, the Pharmaceutical Research and Manufacturers of America (PhRMA) called a similar Trump order a “reckless attack” on innovation. Expect companies to file lawsuits claiming the order oversteps executive authority or violates trade agreements. Pfizer’s CEO, Albert Bourla, recently criticized Trump’s tariff threats, suggesting they deter U.S. investment. Lobbying efforts will likely intensify, with firms like Pfizer and Merck, who boosted lobbying budgets in 2025, leveraging their influence in Congress to delay or dilute implementation.
Public Relations Campaign:
To counter public support for price cuts, companies may launch campaigns emphasizing their role in innovation, particularly in vaccines and cancer treatments. Johnson & Johnson and Moderna could highlight their COVID-19 vaccine contributions, arguing that reduced profits threaten future breakthroughs. PhRMA’s Alex Schriver recently applauded parts of Trump’s Medicare negotiation tweaks, signaling a strategy to align with the administration’s rhetoric while protecting profits. Expect ads and media appearances framing price controls as a risk to American healthcare leadership.
Strategic Price Adjustments Abroad:
To mitigate losses, companies might raise prices in other countries to align with U.S. prices, as Trump’s order anticipates global price equalization. This could spark backlash from foreign governments, potentially leading to trade disputes. Alternatively, firms may negotiate bulk discounts with Medicare to retain market share, as seen in Biden’s Inflation Reduction Act negotiations, which cut prices for drugs like Pfizer’s Ibrance by up to 79%.
Investment in Domestic Manufacturing:
Trump’s simultaneous push for U.S.-based drug production, via a May 5, 2025, order, may prompt companies to accelerate domestic investments to curry favor. Johnson & Johnson and Eli Lilly have already announced U.S. manufacturing expansions amid tariff threats. Moderna and Pfizer could follow suit, framing it as compliance with Trump’s “America First” agenda while seeking regulatory relief.
Innovation Warnings and R&D Cuts:
Companies may warn that lower profits will force reductions in research and development, echoing PhRMA’s 2025 claim that Medicare’s “pill penalty” cut small-molecule investment by 70%. Pfizer and Moderna, heavily reliant on biologics like mRNA vaccines, might scale back riskier projects to protect shareholder value, potentially slowing drug development pipelines.
Industry and Consumer Implications
While consumers may see immediate relief at the pharmacy counter, the order’s long-term effects are uncertain. Critics, like Patients for Affordable Drugs’ Merith Basey, argue that Big Pharma’s influence could undermine patient benefits, as seen in Trump’s April 2025 order delaying Medicare negotiations for small-molecule drugs, which KFF warned could raise Medicare costs. On X, some users speculated that stock declines (e.g., Pfizer dropping from $24.10 to $22.28) signal investor fears of profit erosion.
Big Pharma’s response will likely blend defiance and adaptation. Moderna, Pfizer, and Johnson & Johnson have the resources to navigate this storm, but their actions—legal battles, PR campaigns, or strategic shifts—will shape the future of drug pricing and innovation. As Trump’s order unfolds, the battle between “America First” policies and corporate interests promises to be fierce.
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