If the US saves, Europe pays - Lowering US drug prices endangers access to medicines in the EU
President Donald Trump's move to match drug prices in the United States to the lowest levels in major trading nations is worrying industry and analysts in Europe, who warn of delays in bringing new drugs to market and price hikes in European markets.
In late July, Trump asked drugmakers to adjust prices in the US to the most favorable pricing policy within two months, threatening tough measures if these demands were not met. This is the US president's second attempt to impose this pricing system, after the first in 2020 was blocked by a federal judge. The current situation is raising concerns in Europe about the possibility of delays, higher prices and limited access to innovative drugs.
Industry experts explain that aligning prices in the US with lower prices in other developed countries would have a major impact on the European Union. Since the US is the world's largest market for drugs, a price cut there would hit the industry hard. But instead of cutting costs in the US, companies may choose to raise prices or delay new products in smaller markets, including Europe. Such a delay would make things worse for European patients, especially those who need innovative medicines.
Eucope, an organization of European pharmaceutical companies, emphasizes that small and medium-sized enterprises, especially those developing drugs for rare diseases, will feel this blow more, as they are less able to withstand revenue losses.
Another possible industry strategy could be to raise average prices for larger markets, thus excluding poorer countries and increasing inequalities between Western and Eastern Europe.
It is not yet known whether Trump's scheme will be based on official prices or net prices, which reflect discounts and confidential agreements. Obtaining data on net prices is almost impossible, so the initiative could lead to increases in official prices without changing much the real costs that patients and states pay. This could only create an illusion of price harmonisation, while in practice, the scheme may not be effectively implemented.
The initiative comes at a time of transatlantic trade tensions, with the US threatening tariffs on pharmaceutical imports, threatening global supply chains and risking rising drug prices in the US. Under a trade deal with Trump, the European Union expects these tariffs to not exceed 15%, but that would be enough to drive up the costs of drugs sold in the US.
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