Efforts by the Trump administration to lower drug prices in the United States may inadvertently slow the arrival of new medicines in Europe, according to a modelling study published in The Lancet. The research, led by Thomas Hwang of Brigham and Women’s Hospital and Kerstin Vokinger of ETH Zurich and the University of Zurich, examined 195 patented drugs that account for $87.9 billion in annual US spending.
The study found that for three-quarters of these medicines, the revenue lost from cutting US prices to match those in other wealthy nations would exceed the companies’ total annual sales in the countries used as benchmarks. To protect profits in the world’s largest pharmaceutical market, manufacturers could “be incentivised to delay market launch in the lowest-priced countries in the reference market,” the authors wrote. By postponing launches in cheaper markets, drugmakers could avoid having to align US prices with those lower levels.
“Policies in the US may impact access to medicines globally,” Vokinger said in a press release. The European Patients Forum echoed that concern, telling Euronews Health: “The risk is very concrete: if pharmaceutical companies delay launching medicines in Europe because European prices may be used to determine prices in the United States, patients here could wait longer for treatments that are already available elsewhere. For someone living with a serious or progressive condition, an additional wait can have a real impact on their health and quality of life.”
Signs of a slowdown in Europe
Data already suggest a cooling in drug launches across the EU. Ten months after President Donald Trump’s executive order on drug pricing, launches in EU markets had fallen by roughly 35% compared with the previous ten months, Reuters reported in March. While the link to US policy is not definitively established, a drug for severe high cholesterol was withdrawn from the market in February, with some attributing the move to the pricing pressure.
Alexander Natz, chief of the biotech entrepreneurs’ lobby Eucope, observed that even in larger markets like Germany, companies are reconsidering whether and when to launch. “It’s true that even in bigger countries like Germany, we see companies reconsidering whether they launch or when they launch,” he said. “We shouldn’t expect that we’re not getting access to any medicine, but we should expect that decisions are made in a much more careful way by companies.”
Natz argues that European governments must be prepared to spend more on healthcare if they want timely access to new treatments. “We must have a debate, an internal political debate in Germany and in other countries, how much are we willing to spend for healthcare?” he asked.
But national budgets are already stretched. “Referenced countries, from Germany to Japan to Australia, are facing substantial pressure from the US administration and industry to raise prices and spending on medicines,” said Hwang. “But this is colliding with the reality that other countries have limited budget room to give.”
The study’s authors suggest that manufacturers and governments might turn to list prices—the sticker price before discounts—rather than net prices, which include confidential rebates. This could make pricing more transparent but also potentially higher.
In response, the European Union has updated its pharmaceutical rules, requiring companies to launch a new medicine within three years if a member state requests it, or lose two years of monopoly rights. The authors describe this as a “counterweight” to the US policy’s fallout, but they doubt it will “meaningfully alter the magnitude of savings by themselves.” Natz was similarly sceptical that the conditionality would fully offset the negative consequences.
US savings at risk
The US could save $5.2 billion on hospital-administered medicines and $6.4 billion on pharmacy-dispensed drugs under the most-favoured-nation policy, according to the study. Broader application could raise those figures to $21 billion and $25.5 billion, respectively. However, 17 companies have already struck confidential deals with the administration, excluding themselves from the rules, which would cut potential savings by 71%.
“While the most-favoured-nation pricing has the potential to deliver real savings to the US federal government and taxpayers … if manufacturers can evade participation in these models by striking side deals, most of those savings might not be realised,” Hwang said.
The European Patients Forum warned that if the policy leads to delayed launches without delivering expected savings for Medicare, “this risks becoming a lose-lose situation for both health systems and patients.”
European health ministers have asked the European Health Commissioner to assess the impact of the US policy on the bloc, including whether it is causing delayed launches, higher prices, and reduced access to innovative medicines. The Commission’s analysis, seen by Euronews Health, is expected to inform future EU action. As the debate continues, the interplay between US pricing pressure and European access remains a critical issue for patients across the continent.
