Trump Trade: White House announces drug pricing deal with Pfizer

Catch up on the top industries and stocks that were impacted, or were predicted to be impacted, by the comments, actions and policies of President Donald Trump with this daily recap compiled by The Fly:

DRUG PRICING DEAL: President Donald Trump announced the “first agreement with a major pharmaceutical company,” Pfizer (PFE), to bring American drug prices in line with the lowest paid by other developed nations, the White House announced. “The agreement will provide every State Medicaid program in the country access to MFN drug prices on Pfizer products, resulting in many millions of dollars in savings and continuing President Trump’s historic efforts to strengthen the program for the most vulnerable. The agreement ensures foreign nations can no longer use price controls to freeride on American innovation by guaranteeing MFN prices on all new innovative medicines Pfizer brings to market. The agreement requires Pfizer to repatriate increased foreign revenue on existing products that Pfizer realizes as a result of the President’s strong America First U.S. trade policies for the benefit of American patients. The agreement requires Pfizer to offer medicines at a deep discount off the list price when selling directly to American patients,” a White House fact sheet stated.

Pfizer confirmed an agreement with the Trump Administration that will ensure U.S. patients pay lower prices for their prescription medicines while strengthening America’s role as the global leader in biopharmaceutical innovation. In response to the four points covered in the President’s July 31st letter, Pfizer has voluntarily agreed to implement measures designed to ensure Americans receive comparable drug prices to those available in other developed countries and pricing newly launched medicines at parity with other key developed markets. Pfizer will also participate in a direct purchasing platform, TrumpRx.gov, that will allow American patients to purchase medicines from Pfizer at a significant discount. The large majority of the company’s primary care treatments and some select specialty brands will be offered at savings that will range as high as 85% and on average 50%. Specific terms of the agreement remain confidential.

“We are proud to join President Trump at the White House to celebrate this landmark agreement that is a win for American patients, a win for American leadership, and a win for Pfizer,” said Albert Bourla, Chairman and CEO of Pfizer. “By working closely with the Administration, we are lowering costs for patients and enabling greater investment in the U.S. biopharmaceutical ecosystem by ending the days when American families alone carried the global burden of paying for innovation. This is about putting all patients first and ensuring America remains the world’s leading engine of medical breakthroughs… We’ve agreed to a three-year grace period during which time Pfizer products under a Section 232 investigation won’t face tariffs, provided we further invest in manufacturing in the United States. Additionally, we’ve established a balanced global pricing approach that continues to recognize the value of innovation while ensuring prices in the U.S. and other developed countries are both reasonable and sustainable, maintaining the strength of the U.S. market alongside other developed nations. This agreement allows us to invest even more boldly in the United States – fueling growth, creating jobs, and returning manufacturing home. Our U.S. workforce of 31,000 colleagues, supported by 13 manufacturing and distribution sites and 7 major R&D facilities, underscores Pfizer’s vital role in building a stronger American economy. We are committed to channeling unprecedented resources with an additional $70B dedicated to U.S. research, development and capital projects in the next few years. This builds upon our more than $83B investment in American biotech innovation from 2018-2024, showing how we are strengthening our commitment at this pivotal moment by shaping the future of medicine with the pursuit of pioneering breakthroughs and ensuring the U.S. remains the global hub for medical progress and improving lives.”

MOSTLY PERFORMATIVE: The timing of the “deal” announced between the U.S. and Pfizer on drug pricing “may have come as a surprise,” but the substance of it didn’t, in the opinion of BofA analyst Tim Anderson, whose view over the last weeks-to-months has been that the drug industry might well escape any real pain when negotiating on issues like “most favored nation” drug pricing. Press releases from the White House and from Pfizer “largely lack specifics, but both read as benign,” adds the analyst, who calls the agreement “a loose collection of measures that likely doesn’t cost Pfizer much, yet still provides the Administration with a political win.” The firm keeps a Neutral rating and $28 price target on Pfizer shares.

OTHER DRUGMAKERS: Trump says other drugmakers to join Pfizer with “most favored nation” prices. Publicly traded drugmakers include AstraZeneca (AZN), Bristol Myers (BMY), Eli Lilly (LLY), GSK (GSK), Johnson & Johnson (JNJ), Merck (MRK), Novartis (NVS), Pfizer (PFE), Roche (RHHBY) and Sanofi (SNY).

ACTIVE DISCUSSIONS: An Eli Lilly spokesperson told Bloomberg that the company is in “active discussions” with the Trump administration on drug pricing after President Donald Trump announced the “first agreement with a major pharmaceutical company,” Pfizer, to bring American drug prices in line with the lowest paid by other developed nations.

MEDICARE DRUG PRICE TALKS: The Trump administration issued a final plan for how it will carry out the third round of the Medicare drug price negotiations, pushing forward a Biden-era program despite ongoing opposition from the pharmaceutical industry, Bloomberg’s Nyah Phengsitthy reports. The 381-page final guidance by the U.S. Centers for Medicare & Medicaid Services outlines how the federal government plans to set the prices of up to an additional 15 drugs in the program. The negotiations for the third cycle are slated to begin in 2026 and prices will go into effect in 2028.

GOVERNMENT SHUTDOWN NEGOTIATION: Enhanced subsidies for Affordable Care Act health-insurance plans are set to expire by the end of the year and decisions related to them may be crucial to end a government shutdown, Jasmin Li and Anna Wilde Matthews of The Wall Street Journal report. At the moment, Republicans are pushing to temporarily extend current government funding levels for extra time for negotiations, but Democrats have said they won’t vote for any bill to end a government shutdown if it excludes an extension of the ACA subsidies. These government subsidies cap the max percentage of household income an individual pays toward their ACA health coverage. About 24.3M Americans are enrolled in ACA, with 22.4M receiving subsidies. Publicly traded companies in the space include CVS Health (CVS), Centene (CNC), Cigna (CI), Elevance Health (ELV), Humana (HUM), Molina Healthcare (MOH) and UnitedHealth (UNH).

NOMINATION PULLED: White The White House is pulling the nomination of E.J. Antoni to the role of head of the Bureau of Labor Statistics, CNN’s Kristen Holmes, Adam Cancryn, and Em Steck report, citing three sources. The move comes after CNN reported earlier this month that Antoni had overseen a since-deleted Twitter account that featured sexually degrading remarks about former Vice President Kamala Harris, derogatory language about gay people, conspiracy theories, and insults aimed at President Trump’s critics, the authors note.

NUCLEAR FUEL LINE PILOT PROGRAM: The U.S. Department of Energy announced that it has selected Oklo (OKLO), Terrestrial Energy (HOND), TRISO-X LLC, and Valar Atomics Inc. for its new pilot program to build advanced nuclear fuel lines. The action will help strengthen America’s national security, reduce reliance on foreign sources of enriched uranium and support the Department’s Reactor Pilot Program that aims to have at least three reactors achieve criticality by July 4, 2026, the department said.

“President Trump has made clear that a strong nuclear sector is a central component of America’s energy security and prosperity,” said Deputy Secretary of Energy James P. Danly. “Restoring a secure domestic fuel supply will ensure that advanced reactors can move quickly from design to deployment and into operation. The ability to produce these fuels is essential to ensuring American leadership in nuclear energy and to meeting the nation’s growing demand for reliable power.” This is the second round of conditional selections under DOE’s Fuel Line Pilot Program. DOE previously selected Standard Nuclear to build and operate TRISO fuel fabrication facilities.