Medicaid most-favored-nation deals reach 26 drugmakers, with consumer savings in doubt

The Trump administration announced on Aug. 31 that nine more drugmakers have agreed to cap the prices state Medicaid programs pay for their medicines at the levels paid in other countries, mostly in Europe, bringing the total number of companies with such "most-favored-nation" deals to 26 ^[1]. The agreements do not set prices for the private insurance most Americans use, and analysts say they are unlikely to change what most patients pay at the pharmacy ^[1][2].

The new companies are Alcon, Astellas Pharma, BeOne Medicines, BridgeBio, CSL, Kyowa Kirin, Sun Pharma, Teva Pharmaceuticals and UCB ^[1]. They join 17 companies that signed similar deals starting in late 2025 ^[1][2]. The administration says the agreements cover 90% of the drugs Americans use, and that companies will move some production to the United States in exchange for relief from pharmaceutical tariffs ^[1][2].

For drugs already on the market, most-favored-nation prices apply in only a few places: state Medicaid programs, cash purchases through the government's TrumpRx website, and certain GLP-1 weight-loss and diabetes drugs sold to Medicare or Medicaid ^[2]. The agreements do not affect prices for the majority of Americans who have private insurance, according to FactCheck.org ^[2].

A research letter in JAMA in July estimated the earlier deals with 17 companies would save Medicaid programs about $8.6 billion a year ^[1]. But the terms are not publicly available, and neither are the prices Medicaid currently pays, so the actual savings are hard to verify, said Luca Maini, an assistant professor of health care policy at Harvard Medical School ^[1]. Maini said "the main benefit here is not to the patients using the drugs, but to the fiscal health of the program" ^[1].

Dr. Thomas Hwang, an assistant professor at Brigham and Women's Hospital, said long-term savings are "likely illusory," because companies often respond to such deals by raising prices in the countries the U.S. uses for comparison ^[1]. Dr. Suhas Gondi, an instructor at Harvard Medical School, predicted companies may delay launching new drugs in some countries so they don't have to match those prices ^[1].

At a press conference, President Trump said, "For decades, Americans paid the highest drug prices anywhere in the world by far. We now pay the lowest price paid by other countries anywhere in the world" ^[1]. Centers for Medicare & Medicaid Services Administrator Mehmet Oz attributed a recent drop in prescription drug prices to the deals and to TrumpRx ^[2].

The Bureau of Labor Statistics reported in mid-August that prescription drug prices fell 3.1% over the previous year, the largest one-year decline since 1963, and 3.3% since the start of 2026, the steepest six-month drop since the agency began tracking in 1947 ^[2]. Several drug pricing experts told FactCheck.org that other factors likely explain most of that decline, including market pressure on GLP-1 drugs, more generics entering the market and Medicare price negotiations authorized under the 2022 Inflation Reduction Act ^[2]. Cynthia Cox, a senior vice president at KFF, said "market forces... in particular around GLP-1 drugs" are hard to ignore ^[2].

Jeromie Ballreich, a health economist at Johns Hopkins University, said the only place most-favored-nation prices would show up in the consumer price index is TrumpRx, and that the site serves too small a share of patients to move the overall market ^[2]. Earlier reporting by the New York Times found that U.S. consumers still pay higher prices on TrumpRx than patients pay in other countries ^[1].

The White House says TrumpRx has saved patients more than $700 million and that the most-favored-nation deals will save over $500 billion in 10 years ^[2]. FactCheck.org has previously questioned the assumptions behind the $500 billion figure, and $700 million is less than 0.2% of the $467 billion spent on prescription drugs in the U.S. in 2024, according to national health expenditure data ^[2]. White House spokesman Kush Desai said the deals cover hundreds of drugs, including GLP-1s and fertility drugs that are not typically covered by insurance ^[2].

Why it matters for patients

If you get insurance through an employer or buy it on your own, these agreements do not change what you pay for semaglutide (Ozempic, Wegovy, Rybelsus), tirzepatide (Mounjaro, Zepbound) or other brand-name drugs ^[2]. The savings flow to state and federal Medicaid budgets, and Medicaid enrollees generally already pay little for prescriptions ^[1]. Hwang described the most-favored-nation approach as "an administratively easier pathway than lower drug prices for all payers" ^[1].

Cash prices on TrumpRx can help some people without insurance, or those who need a drug their plan will not cover, such as a GLP-1 for weight loss ^[2]. But most people get a better deal going through their insurance, and some drugs listed on the platform have cheaper generic versions available elsewhere ^[2]. Ballreich said the deals lack public detail, making it unclear how many products are actually covered ^[2].

The agreements also do not address some underlying reasons U.S. prices stay high. Hwang noted that drugmakers extend patents on blockbuster drugs in the U.S., a practice not available in many other countries; patents for some GLP-1 medications expired in 2026 in India, China and Brazil, allowing generic versions to be made there ^[1]. Whether those generics reach the U.S. market has not been reported.