Merck & Co., Inc. (MRK.US), Bristol-Myers Squibb (BMY.US) and several other pharmaceutical companies have agreed to lower drug prices in the United States in exchange for tariff exemptions and policy support from the Trump administration.

As U.S. President Trump pushes to link drug prices in the U.S. with lower prices in overseas markets, several large pharmaceutical companies in the U.S. and Europe have recently reached agreements with the White House to voluntarily reduce the prices of drugs sold in the U.S. in exchange for tariff exemptions and policy support. The Trump administration is restarting the "most favored nation drug price" policy, attempting to use administrative means to reduce the high cost of prescription drugs in the U.S. According to the White House, companies that have signed agreements include Merck & Co., Inc., Bristol-Myers Squibb, Amgen, Gilead Sciences, GlaxoSmithKline, Sanofi, Rogers Corporation, Boehringer Ingelheim, and Novartis AG. These companies have agreed that their products will not be affected by the special tariffs planned by the Trump administration for the pharmaceutical industry in the next three years, as long as they continue to increase production and investment in the U.S. The most market attention in this agreement is Bristol-Myers Squibb's commitment to concessions. The company has stated that it will provide its popular anticoagulant drug Eliquis free to Medicaid patients in the U.S. Eliquis is one of the most prescribed drugs in the U.S., and this move is seen as one of the most significant measures in this round of price reductions. At a public event on Friday, Trump stated that out of the 17 large pharmaceutical companies he wrote to requesting price reductions in July, 14 have agreed to significantly reduce drug prices. "This represents the biggest victory in terms of affordability in the history of the U.S. healthcare system, and every American will benefit from it." He also pointed out that Johnson & Johnson, AbbVie, and Regeneron Pharmaceuticals have not signed agreements yet, but Johnson & Johnson is expected to join next week. Although the full terms of the agreements have not been disclosed, the White House revealed that these pharmaceutical companies have agreed to take multiple measures to lower drug prices in the U.S., including selling existing drugs to Medicaid patients at "most favored nation prices", and committing to pricing for future new drugs. In addition, Trump stated that these companies will also list their most popular drugs on the government's direct sales platform, TrumpRx, scheduled to launch in January next year. Several companies have announced the launch or expansion of direct-to-patient sales plans. Gilead Sciences, Inc. said that patients will be able to obtain their hepatitis C treatment drug Epclusa at a discounted price, while Sanofi stated that discounts on some of their drugs in the areas of infections, cardiovascular, and diabetes will be close to 70%. Merck & Co., Inc. announced that they will provide the diabetes drugs Januvia, Janumet, and Janumet XR to cash-paying patients at a discount of around 30%, and will extend the plan to include their daily cholesterol-lowering drug once it is approved. Davis, the CEO of Merck & Co., Inc., expressed support for Trump's policy direction of lowering drug prices in the U.S. while raising prices in overseas markets and ending global free riding. Meanwhile, Amgen announced an expansion of its existing direct sales program, including the preventive migraine drug Aimovig and the autoimmune therapy drug Amjevita, with monthly discounts reaching 60% and 80% respectively. Earlier this year, the Trump administration reached similar agreements with Lilly, Novo Nordisk, Pfizer, Astrazeneca, and EMD Serono, allowing them to sell some drugs directly to patients at a discounted price in exchange for tariff exemptions and policy support for new drug approvals. Data shows that the average price of prescription drugs in the U.S. is almost three times that of overseas markets, with brand-name drug prices being more than four times higher. Although the PhRMA industry association believes that "most favored nation pricing" is not the best way to lower drug prices and blames drug benefit management organizations for the price difference, the U.S. market remains one of the most important sources of revenue for global pharmaceutical companies, especially for European pharmaceutical companies, whose dependence on the U.S. market remains high.