Access Infinity closely analysed the U.S. MFN policy from the perspective of global pricing and market access implications for pharmaceutical manufacturers, focusing on how they can strategise to seize opportunities and address challenges. 

U.S. Moves Toward "Most Favored Nation" Drug Pricing—A Policy Shift with Global Ripple Effects

U.S. President Donald Trump has signed an executive order to implement Most Favored Nation (MFN) drug pricing, aiming to align U.S. drug costs with the lowest prices paid by developed nations. The policy, which applies to Medicare, Medicaid, and the private sector, intends to leverage U.S. trade power to force pharmaceutical companies and comparator nations to voluntarily adopt a global pricing structure. However, the pharmaceutical industry has strongly opposed MFN pricing, citing risks to research investment, market stability, and international pricing strategies. When a similar proposal was introduced in late 2020, it faced legal challenges and was ultimately blocked in court.

Agile and Proactive Approach Needed by Pharma Amidst Global Transformations Owing to U.S.’ Proposed MFN Policy

Pharmaceutical companies need to adopt an agile and proactive strategy to mitigate risks and capitalise on opportunities arising from the U.S. MFN drug pricing policy. Here’s a structured approach:

1. Strategic Market Adaptation

Assess Reference Markets: Identify which countries the U.S. might use as comparators, adjusting pricing strategies accordingly
Dynamic Launch Planning: Reevaluate market sequencing to prevent unintended price reductions in MFN-linked geographies
Regional Pricing Optimisation: Consider differentiated pricing structures based on therapeutic value and payer negotiations rather than a static global pricing strategy

2. Competitive & Regulatory Engagement

Regulatory Foresight: Prepare legal arguments to challenge MFN-driven price controls, leveraging industry groups and trade associations to shape policy outcomes
Global Pharma Coalition: Collaborate with international pharma alliances to engage policymakers and influence trade discussions that impact drug pricing structures

3. R&D & Portfolio Diversification

Accelerate Innovation: Increase focus on high-value therapies, such as personalised medicine, biologics, and orphan drugs, which may face less MFN pricing pressure
Flexible Manufacturing & Supply Chains: Prepare for potential market exits or delays, ensuring adaptable production and distribution models
Data-Driven Value Metrics: Strengthen health economics and outcomes research (HEOR) to provide evidence-based pricing justifications especially to secure premium reimbursement in high-price European markets such as Germany, Sweden

4. Pricing & Commercial Model Evolution

Adopt Alternate Pricing Mechanisms: Shift towards subscription-based models, outcome-based pricing, and risk-sharing agreements to maintain revenue sustainability
Innovate Payment Structures: Explore direct-to-consumer models, bypassing traditional middlemen like pharmacy benefit managers (PBMs)
Ensure Market Resilience: Prepare discounting contingencies for MFN-affected therapies while retaining pricing integrity in non-reference regions

5. Crisis & Scenario Planning

Legal Contingencies: Prepare for potential litigation or regulatory shifts, analysing how global precedent impacts MFN enforceability
Global Market Simulations: Model pricing ripple effects across key geographies, ensuring early visibility into launch delays or revenue compression risks
Strategic Communication: Maintain transparent dialogue with investors, patients, and healthcare stakeholders to sustain trust and adaptability

Click here to learn about Access Infinity’s Digital + Consulting Suite of Solutions

Authored by   

Nikhil Taxak, Ph. D, APAC Head, Pricing and Market Access Data and Analytics*

Samrudhi Mansukh, Analyst, Data Team

David McConkey, Partner

Brett Gardiner, Senior Partner

All authors represent Access Infinity

*Corresponding author: nikhil@accessinfinity.com