Trump Administration Launches Two Medicare Drug Price Pilot Programs

Opposition from Alliance for Aging Research, a Big Pharma front:

https://www.realclearhealth.com/articles/2025/12/22/new_medicare_most_favored_nation_demos_arent_worth_the_price_1154824.html

New Medicare ‘Most Favored Nation’ Demos Aren’t Worth the Price
By Sue Peschin - December 22, 2025

Last week, the Center for Medicare and Medicaid Innovation (CMMI) announced two new mandatory "demonstrations" that would impose foreign price controls on medicines covered by Medicare Parts B and D.

The Global Benchmark for Efficient Drug Pricing (GLOBE) and Guarding U.S. Medicare Against Rising Drug Costs (GUARD) would significantly restrict Medicare beneficiaries' access to lifesaving drugs and deter future research into diseases that disproportionately affect older adults.

Under these "most favored nation"-type (MFN) models, Medicare Parts B and D prescription drug prices would be capped based on the lowest price charged in other wealthy countries, such as Canada, France, and the United Kingdom (U.K.).

The push for MFN stems from President Trump's well-founded frustration over Americans paying higher prices for prescription drugs than patients abroad. According to a 2024 U.S. Department of Health and Human Services report, "for every dollar paid in other countries for drugs, consumers in the U.S. pay $2.78" and "the gap is widening over time."

But MFN as a solution to this imbalance misses a key difference between the U.S. and other countries, and it would unintentionally result in worse access to care for patients.

Underlying the current MFN debate lies the assumption that other countries value the "latest and greatest" treatments the same way we do, and those countries would pay more if prompted.

Unfortunately, that's not the case. Foreign health systems that rely on price controls frequently ration care, delay access to new treatments, or deny coverage altogether.

Canada, France, the U.K, and many other foreign countries have government-run healthcare systems that cherry-pick which treatments are covered (or not) based on unfair value assessments, using methodologies that the U.S. Congress wisely has deemed illegal. Not surprisingly, this has not only resulted in access issues but has also translated into higher mortality rates for chronic diseases, such as cancer—compared to the U.S.

President Trump's intention is to expand access by decreasing costs. However, when the first Trump administration pursued an MFN policy, the Centers for Medicare and Medicaid Services (CMS) data showed the proposal relied on a reduction in patient utilization of prescription drugs of up to 19% to achieve its projected $87.8 billion in savings to the Medicare program.

And those savings wouldn't have trickled down to patients. An Avalere study found that fewer than 1% of Medicare Part B beneficiaries would have experienced any reduction in out-of-pocket costs. In cases where certain drugs named in the proposal had no comparable alternatives, patients would have been left without any treatment options.

It's doubtful whether CMMI even has the authority to mandate participation in these nationwide demonstrations, which are far larger in scope than the small reforms and pilot programs that Congress envisioned and empowered CMMI to conduct.

We hope the Administration rethinks these demonstrations and focuses on policy solutions that truly help older patients afford their medicines. Drug price debates won't matter unless policymakers confront fundamental drivers of patient costs: excessive rebate demands and utilization management abuses by insurers and pharmacy benefit managers (PBMs). These practices are unethical, unsustainable, and leave patients caught in the middle.

Everyone shares the Administration's interest in improving Medicare prescription drug affordability. But MFN-type policy demonstrations like GLOBE and GUARD will dramatically reduce access to the medications our families rely on, and that’s not worth the price.

Sue Peschin, MHS, is President & CEO of the Alliance for Aging Research in Washington, D.C.