International Pricing Puts People With Chronic Diseases at Risk

COMMENTARY

A recent White House executive order could make it harder for millions of Americans to access their lifesaving medications. 

Its most consequential provision proposes a “Most Favored Nation” pricing model, which would tie U.S. drug prices to those paid in other high-income countries. The administration already determined its criteria for specific pricing targets, setting the stage for major changes to the way medicines are valued in the United States. 

The MFN policy is billed as a push for fairness — and, on the surface, has some appeal. In reality, it would adopt foreign price-setting systems that restrict treatment options and raise serious ethical concerns about valuing patients differently based on where they live or what chronic conditions they face. The policy would also undercut the investment needed to develop breakthrough therapies, delaying — or eliminating — advances that could address unmet medical needs and reduce chronic disease in America.

For the 190 million Americans living with chronic conditions like cancer, diabetes and heart disease, that’s more than a policy misstep — it’s a direct threat to their health. There are better ways to lower costs without putting patients at risk. 

The idea behind MFN is that Americans are subsidizing medical innovation for other wealthy countries — paying higher medicine prices than members of the Organization for Economic Cooperation and Development with a comparable GDP per capita.

That imbalance is real. 

But it exists because many of these OECD reference countries rely on artificial price ceilings, delayed approvals and rigid barriers to patient access to keep spending down. The national health systems in countries like Germany and Canada routinely restrict access to the latest treatments — even when they represent the best option for patients and are prescribed by their doctors.

The result is a clear gap in access.

Between 2018 and 2022, Americans had access to 74% of new medicines launched globally, according to a recent report. In contrast, patients in Germany, Canada and Australia could access just 52%, 28% and 22% of those medicines, respectively. Their health care formula involves valuing treatments based on who receives them — using discriminatory tactics that deem older adults, people with disabilities and those with chronic conditions less worthy of treatment. 

If the United States adopts those same pricing policies, we’ll face the same outcomes: fewer options, more delays and reduced access to care. For patients managing complex chronic conditions like cystic fibrosis — where timing, continuity and precision are critical — the consequences could be catastrophic.

This isn’t the first time MFN has raised alarms. A previous iteration of the policy, attempted during President Donald Trump’s first term and limited to certain Medicare drugs, was projected to save money in part because patients would lose access to their prescribed medications. That was the final assessment of the Centers for Medicare and Medicaid Services.

Denying care means spending less, but it is the exact opposite of policies needed to make Americans healthy.

The latest version of MFN attempts to cast an even wider net, potentially threatening access for people enrolled in Medicare, Medicaid and private insurance alike.

MFN also risks cutting off the resources that fuel future breakthroughs. The policy would jeopardize the promising pipeline of innovations aiming to address unmet medical needs for a variety of chronic and rare patient communities. 

Approximately 83 million Americans will be living with three or more chronic conditions by 2030. Treatments in development now — for Alzheimer’s, rare cancers, autoimmune disorders and more — could change the trajectory of those lives. MFN puts that progress at risk.

Working to address frustration about high out-of-pocket costs should absolutely be a priority. But there are better, patient-centered solutions that would lower costs while maintaining broad access to treatment options.

Currently, half of every dollar spent on branded medicines goes to middlemen like pharmacy benefit managers and insurers. PBMs manage formularies — the lists of drugs insurers cover — and use that leverage to extract steep rebates and discounts from manufacturers, sometimes up to 80% off. In most cases, those savings aren’t passed to patients. Instead, patients are charged based on the inflated list price. PBMs are uniquely American, and their incentives are misaligned in today’s market.  

This pricing distortion hits people with chronic diseases the hardest. For someone managing multiple chronic conditions, the gap between list and net price can mean the difference between staying on treatment or skipping doses due to cost. When patients don’t take their medications as directed, manageable conditions can escalate into costly, life-threatening emergencies.

We need to fix the system. That means requiring PBMs and insurers to pass negotiated discounts directly to patients and bringing transparency to a supply chain that has operated in the shadows for too long.

We must pursue meaningful cost reform that supports patients, innovation and the hard-won progress we’ve made for people living with cancer, cystic fibrosis and other chronic conditions.

But the MFN pricing model is not a tradeoff we can afford.

Kenneth E. Thorpe is the Robert W. Woodruff Professor of Health Policy at Emory University and the chairman of the Partnership to Fight Chronic Disease. He can be found on LinkedIn.