The move acceded to the demands in President Trump’s “Most Favored Nation” executive order, which aims to bring down U.S. drug prices and linking them to lower prices overseas.
“The United States is done subsidizing the health care of the rest of the world,” Trump said Tuesday.
Pfizer’s vast product portfolio includes cancer therapies like Ibrance and Xtandi as well as its COVID-19 products like its vaccine and the antiviral Paxlovid.
Trump sent a letter to drug companies in July demanding they provide preferential pricing to all Medicaid patients, required that they not give better prices to other developed countries on new drugs, create a way to sell directly to consumers and use trade policy to raise prices internationally so that revenue is reinvested into lowering American prices.
Those who refused risked facing “every tool in our arsenal to protect American families from continued abusive drug pricing practices,” according to Trump’s letter.
“With this deal that we signed today, we satisfied all four of [the] president’s requests, all four,” Bourla said.
Senior administration officials said talks are ongoing with other drugmakers, though Trump said Eli Lilly was among companies that would soon be announcing deals with the administration.
The Pfizer CEO has previously chafed against price-control measures, once calling Medicare negotiations established through the Inflation Reduction Act “not negotiation at all. It is price setting.”
Trump said he used the threat of tariffs to bring drug companies to the negotiating table. Bourla said Trump “graciously” gave his company a three-year grace period from tariffs.
