The Trump administration is considering tying U.S. drug prices to those paid by other developed countries, a move industry insiders call their top concern. Two sources said the policy is likely to come from the Medicare and Medicaid agency, with one confirming direct discussions with health officials. The measure, known as international reference pricing, is viewed as a major threat to the pharmaceutical industry and U.S. biosciences innovation—more so than other proposals like tariffs.

Although Trump has not publicly detailed this plan, his first-term attempt was blocked by the courts. A previous version projected $85 billion in taxpayer savings over seven years. Industry group PhRMA has lobbied against the idea, which remains unpopular due to its potential to disrupt healthcare and reduce incentives for innovation.
Analysts expect the Medicare agency to launch a pilot. However, implementation would be difficult due to staffing shortages and the complexity of global pricing data. Not all drugs are sold in reference countries, and pricing transparency varies. Experts also warn manufacturers could raise prices abroad to offset U.S. caps. Despite these challenges, think tanks aligned with Trump are pushing to revive the policy as part of broader Medicare drug price reforms.