Pharma Cuts

In Short: Donald Trump has ordered sweeping cuts to US drug prices, threatening to tie them to the much lower prices paid by other wealthy countries. Pharmaceutical stocks dipped, then bounced, as investors questioned how real the threat is.

What’s Going On?
If implemented, the US could finally stop being pharma’s cash machine. The plan forces drugmakers into 30-day negotiations to slash prices or face “most favoured nation” pricing—matching the lowest price globally. That hits hard: Wegovy costs $88 in London, but $1,300 in New York. Medicare, Medicaid, and private insurers could all feel the squeeze. Investors are nervous—UBS says US drugmakers risk a 10% profit hit, and even Euro pharma giants like AstraZeneca and Novo Nordisk could feel the sting. Pharma lobbyists are sharpening their legal swords, while middlemen like CVS and UnitedHealth are also sweating under the spotlight.

Insights: With elections looming, Trump is positioning himself as the man who tamed Big Pharma. But enforcement is tricky and pharma’s legal firepower is vast. Still, the message is clear: the golden era of unchecked US drug pricing may be on borrowed time—and law firms and policy teams should buckle up.

How Does This Impact Law Firms?