Americans continue to pay dramatically higher prescription drug prices than the rest of the world, with some medications costing over 10 times more in the United States than in countries like France.
At a Glance
- Americans pay substantially more for prescription drugs than people in other developed nations, with some medications costing up to 10 times more
- Trump’s Most Favored Nation policy aimed to require pharmaceutical companies to offer their lowest global prices to U.S. customers
- The Inflation Reduction Act of 2022 allowed Medicare to negotiate drug prices and capped insulin costs at $35 monthly for Medicare beneficiaries
- Other countries like France use national health plans to negotiate lower drug prices at a national level
- Bipartisan efforts continue with senators proposing legislation to address pharmacy benefit managers and price transparency
The Price Gap Crisis
The disparity in prescription drug prices between the United States and other developed nations has reached alarming levels. Americans routinely pay substantially more for the same medications available in countries like France, Canada, and Australia. This pricing gap exists across virtually all prescription drugs, with some medications in the U.S. costing more than ten times what patients pay in other countries.
The lack of a comprehensive national prescription drug strategy has left American consumers vulnerable to these inflated prices, creating financial hardship for millions who depend on these medications.
While other developed nations have implemented systems to control drug costs, the United States has maintained a fragmented approach that allows pharmaceutical companies to set prices with minimal regulation. Countries with national health plans systematically evaluate drug value and negotiate pricing at the national level, resulting in dramatically lower costs for their citizens. Though these systems occasionally face challenges like drug shortages, they have proven effective at keeping medications affordable for their populations.
— Charles Rotter (@crotter8) April 15, 2025
Trump-Era Reforms and Recent Efforts
During his administration, President Trump implemented several initiatives aimed at reducing prescription drug costs. A centerpiece of these efforts was the Most Favored Nation policy, which required pharmaceutical companies to offer their lowest global prices to American consumers.
This approach sought to leverage the pricing advantages other countries had secured through their national negotiation systems. Trump also pushed for rebates from pharmaceutical companies to be passed directly to Medicare beneficiaries instead of being absorbed by middlemen in the supply chain.
The Trump administration also launched a successful pilot program that capped insulin costs for Medicare Part B beneficiaries at $35 per month. This initiative was later expanded through the Inflation Reduction Act of 2022, providing relief for millions of diabetic seniors. Additionally, the Act granted Medicare limited authority to negotiate prices for certain high-cost medications, resulting in significant price reductions for some drugs that had previously been among the most expensive in the American market.
— M.A. Rothman (@MichaelARothman) May 13, 2025
Ongoing Bipartisan Reform Efforts
Despite some progress, comprehensive reform remains elusive. Several Trump-era initiatives were stalled or rescinded after the administration change, creating policy inconsistency. However, bipartisan efforts continue in Congress. Senators Josh Hawley and Peter Welch have introduced legislation similar to Trump’s plan to lower U.S. drug prices by tying them to international benchmarks. Meanwhile, Senator Chuck Grassley has proposed a bill focused on increasing transparency in pharmacy benefit managers’ pricing and fees.
Pharmacy Benefit Managers (PBMs) have come under increased scrutiny for their role in the drug supply chain. These entities negotiate with manufacturers on behalf of insurers and set formularies that determine which drugs receive coverage. Critics argue that PBMs’ practices lack transparency and may contribute to higher consumer prices. Senator Thom Tillis has advocated for a comprehensive evaluation of the entire medication supply chain, suggesting that piecemeal approaches may be insufficient to address the complex factors driving high prices.
The stark reality remains that Americans pay significantly more for prescription drugs than consumers in other developed countries. While insulin price caps and limited Medicare negotiation authority represent important steps forward, they address only a fraction of the overall prescription drug market. Without more comprehensive reform, the price gap between the U.S. and countries like France will likely persist, continuing to strain American household budgets and limiting access to essential medications for many citizens.
