WASHINGTON — President Donald Trump delivered remarks from the Oval Office on Tuesday outlining a new plan to lower prescription drug costs for Americans, highlighted by an agreement with pharmaceutical giant Pfizer.
Trump said the deal addresses what he called a long-standing problem in which U.S. consumers have been paying far more than patients overseas for the same products.
“For many years Americans have paid the highest prices anywhere in the world — paid far more, 10 times, 13 times, 15 more than other countries for the exact same product,” Trump said. “A major reason is that the American consumer is subsidizing research and development costs for the entire planet.”
He noted that while the U.S. has just 4% of the world’s population and only 13% of prescription drugs, pharmaceutical companies make 75% of their profits from American customers.
“So think of that,” he said. “We have 4% of the market, 13% of prescription drugs … and yet … they make 75% of their profits from the American customers, so it’s something that’s why I signed an executive order combating this practice.”
Pfizer has agreed to offer all of its prescription medications to Medicaid at most-favored-nation prices, Trump said, which he argued will significantly reduce costs.
“Today, Pfizer is committing to offer all of their prescription medications to Medicaid, and it will be at the most favored nation’s prices,” he said. “It’s going to have a huge impact on bringing Medicaid costs down, like nothing else.”
Treump added that Pfizer will also provide some of its most popular medications to all consumers at discounts ranging from 50% to 100%, with drugs available for direct purchase online through a government-operated website.
“Moving forward all new medications introduced by Pfizer to the American market will be sold at the reduced most favored nation cost,” Trump said.
As part of the deal, Pfizer will invest $70 billion to restore domestic manufacturing facilities, bringing production and research back to the U.S. The agreement also includes a three-year grace period during which Pfizer’s products will not face pharmaceutical-specific tariffs.
Shares of Pfizer rose more than 4% following the announcement.
Trump said his administration is now working with other major pharmaceutical companies to secure similar agreements.
The president praised his team and negotiators who helped finalize the deal, calling it “a major step forward” in reducing drug prices for Americans. He added that the initiative will include a new website, Trump RX, allowing Americans to purchase medications directly from Pfizer.
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