How did Trump's drug pricing policies compare to those of the Biden administration?
Executive summary
Trump’s second-term actions shifted away from several Biden executive initiatives that would have tested pilot models to lower Medicare and Medicaid drug costs, while preserving statutory changes already enacted by the Inflation Reduction Act (IRA) such as Medicare price negotiation and caps on out‑of‑pocket costs (e.g., insulin cap and $2,000 annual limit) [1] [2] [3]. At the same time, the Trump White House launched its own multi‑pronged approach — including a Most‑Favored‑Nation (MFN)/TrumpRx strategy, voluntary manufacturer deals, and continued use of Medicare negotiation authority — that administration officials say has produced large headline reductions for selected drugs [4] [5] [6] [7].
1. What Biden put in place: law vs. experimentation
Biden’s administration pursued two distinct tracks: statutory reforms embedded in law and executive actions to pilot new approaches. The major binding achievement was the IRA’s Medicare drug price negotiation and the new caps on beneficiaries’ out‑of‑pocket spending (including insulin limits and a $2,000 annual cap), which are law and were not undone by Trump’s rescissions [1] [2] [3]. Separate from those laws, Biden used executive authority — notably a 2022 executive order — to direct the Center for Medicare and Medicaid Innovation (CMMI) to test payment and benefit models (for example, a $2 monthly generics pilot); those pilot efforts were vulnerable to reversal because they were executive, not statutory, actions [8] [1].
2. Trump’s first moves: rescind some Biden pilots but not the law
On Day One, President Trump revoked several Biden executive orders tied to experimental pricing models and other health initiatives, effectively halting CMMI testing of new pilot models intended to reduce prescription costs for Medicare and Medicaid recipients [9] [1] [2]. Fact‑checking and legal observers emphasize that the rescissions did not nullify IRA provisions already implemented — meaning the negotiation authority and cost caps remained in force — though they signaled the administration would not pursue the same experimental pathways Biden had set in motion [1] [3] [10].
3. Trump’s alternative strategy: MFN, TrumpRx and voluntary deals
Rather than continuing Biden’s experimentation, the Trump White House rolled out a different policy platform focused on “Most‑Favored‑Nation” pricing, a TrumpRx direct‑purchase pathway, and pressure on manufacturers to offer lower prices or face rulemaking or importation steps [4] [5]. The White House framed this as forcing U.S. prices in line with comparable wealthy countries and instructed HHS to pursue MFN pricing and explore drug importation if firms didn’t comply [4] [5]. Legal analysts and firms tracking the order note aggressive directives and a roadmap for future rulemakings but also point out the plan’s implementation complexities and prior litigation history around MFN approaches [11] [5].
4. Where Trump used Biden’s tools — and where he diverged
Politically and practically, the Trump administration has used the IRA’s negotiation framework even as it criticized it: CMS under Trump continued to implement negotiated prices for selected Part D drugs and the administration touted larger negotiated cuts in a subsequent round [6] [7]. At the same time, Trump emphasized executive deals with manufacturers (e.g., announced agreements on GLP‑1 drugs and Pfizer later signing on to an MFN framework) and new consumer channels like TrumpRx, indicating a mix of leveraging the law while pursuing presidentially driven market pressure [5] [7] [6].
5. Disagreements among experts and political actors
Observers disagree on effectiveness and intent. Some Republicans and the White House argue MFN and voluntary manufacturer deals can quickly lower prices and “stop foreign free‑riding” [4]. Conservative critics — including pro‑Trump groups like those allied with Mike Pence — have labeled some MFN moves “socialist price controls,” reflecting ideological splits within the GOP about government role in pricing [12]. Independent analysts caution that Trump’s rescission of Biden pilots signals a shift away from testing broader beneficiary reforms and that many proposed Trump measures face legal, logistical, and market hurdles [8] [10].
6. What this means for patients and taxpayers — and what sources don’t say
Available reporting shows Trump’s early rescissions likely had limited immediate effect on beneficiaries because statutory IRA protections remained intact; however, halting CMMI pilots could constrain future experimentation that might further lower costs [8] [1]. The Trump administration claims large savings from negotiated rounds and manufacturer agreements, but sources note implementation details and long‑term sustainability remain unclear and contested [7] [6]. Available sources do not mention specific nationwide out‑of‑pocket impacts across all patient groups beyond the selected drugs and headline savings figures; they also do not fully resolve whether voluntary MFN deals will produce durable, economy‑wide price reductions (not found in current reporting).
Bottom line: Biden’s legacy combined statutory negotiation power (IRA) with experimental pilots via executive action; Trump preserved the statutory pieces while reversing some Biden experiments and pursuing an MFN/TrumpRx strategy plus voluntary manufacturer deals — a strategy that has produced headline savings but remains legally and practically contested and still underreported in key implementation details [1] [4] [5] [6].