Media Contact
On Monday, President Trump urged pharmaceutical companies to reduce their drug prices within a month to align more closely with those in other wealthy nations, warning that failure to comply could result in strict limits on their Medicare earnings.
Colleen Carey, an associate professor at Cornell University, researches the industrial organization of health care, with a special attention to federal regulation of health insurance markets.
Colleen Carey
Assistant Professor of Policy Analysis & Management
“There are clearly a lot of views about the prescription drug industry within the Trump administration, and on days like today you see them all at once. There are legal mechanisms to pay less for prescription drugs in Medicare, both using the annual rule making process and using the newer powers in the Democrats’ Inflation Reduction Act, now negotiating lower prices for Ozempic (among others) in their second round.
“Trump promised a gigantic cut to Medicare drug prices late Sunday on Truth Social, but in the 12 hours after he apparently changed his mind and decided to just request voluntary lower prices. He threatens to use the legal mechanisms if he doesn't get what he wants, but it's not clear what level of lower prices would fulfill the request. Given this executive order, potential loss of Medicaid customers, and a giant pullback in support for early-stage drug research, it's clear the industry is not out of the hot seat.”
