Trump’s Drug Price Ultimatum Sends Shockwaves Thro

Washington, D.C.  — Pharmaceutical companies are racing to respond after U.S. President Donald Trump issued a stern ultimatum demanding “binding commitments” to reduce drug prices to international standards. The White House confirmed Thursday that formal letters were sent to 17 major drugmakers, giving them until September 29 to align U.S. prices with “most favored nation” (MFN) levels or face unspecified government action.

The directive, which includes giants such as Pfizer, AstraZeneca, Merck, and Johnson & Johnson, instructs firms to offer MFN pricing to all Medicaid patients and cease selling medications to foreign markets at lower rates than in the U.S. Companies were also urged to bypass pharmacy benefit managers and sell drugs directly to American consumers.

“If they refuse to step up,” the letter warns, “the administration will deploy every tool in its arsenal to protect American families.”

Healthcare stocks reacted sharply. Shares of Novo Nordisk dropped 5% early Friday before rebounding slightly. Broader healthcare indices also declined amid ongoing concerns over trade tariffs and regulatory uncertainty.

This move follows Trump’s May executive order linking U.S. drug prices to international benchmarks and reflects his long-standing promise to tackle what he has called "abusive pricing practices." The U.S. currently pays more than any other developed country for many prescription medications.

While the industry has largely pushed back, some executives voiced cautious support. AstraZeneca CEO Pascal Soriot acknowledged the issue of price disparity and revealed plans to invest $50 billion in U.S. operations. Similarly, Novartis CEO Vas Narasimhan expressed interest in MFN-based solutions.

Analysts at JPMorgan noted that while the administration’s tone is aggressive, ongoing discussions may soften the immediate impact. “We believe no significant negative changes will occur in the short term,” said analyst Seiji Wakao.

As the deadline approaches, the pharmaceutical sector remains under intense pressure to respond, balancing pricing reform with investment and innovation strategies in the world’s largest drug market.