President Donald Trump’s new executive order on prescription drug prices — which he called “one of the most consequential executive orders in our country’s history” — may well live up to the hype, but not in the way Trump intends.
Trump’s announcement of a “most favored nation” policy means the United States government will only pay drug prices equal to the lowest paid by any developed nation. This is what Germany, France, Canada, and the United Kingdom currently do: pay less for drugs than they’re worth. In turn, the United States picks up the tab when it buys up drugs for Medicaid.
We overpay, and it’s easy to write it off as unfair freeloading by Europe, a recurring theme for the Trump administration. But this remedy will not come without its costs, and consumers will feel it down the line.
The Trump administration’s solution for drug pricing is identical to…
