Emerging Policy Signals Shaping Pharmaceutical Policy
The ISPOR Monthly Policy Brief provides concise insights into emerging developments shaping the global health policy landscape. Each edition highlights timely issues relevant to the health economics and outcomes research (HEOR) community and beyond, examining how evolving policy decisions influence healthcare systems, evidence generation, innovation, and patient access.
Ana Amaris, MD, MPH, Director, Health Policy Initiatives, ISPOR
Overview: This July installment delves into themes from ISPOR’s recent Health Policy Leadership Exchange (HPLE). Over the past several months, pharmaceutical policy discussions have expanded well beyond traditional debates surrounding drug pricing and reimbursement. Across multiple jurisdictions, governments are increasingly linking pharmaceutical policy with broader objectives related to industrial competitiveness, trade, domestic manufacturing, innovation, and long-term health system sustainability. At the same time, questions surrounding affordability, evidence generation, and equitable access have become increasingly interconnected, challenging policy makers to evaluate policy reforms within a broader systems context.
These broader trends were also reflected during discussions at the HPLE, where experts from government, academia, industry, payer organizations, and health policy institutions examined the evolving implications of the Most Favored Nation (MFN) drug pricing initiative in the United States. While discussions centered on MFN, they consistently returned to a series of broader policy themes that increasingly extend beyond any single pricing policy.
1. Pharmaceutical pricing is increasingly becoming embedded in trade and industrial policy.
Recent developments suggest that pharmaceutical pricing is no longer being considered solely within the context of healthcare financing. In the United States, discussions surrounding MFN have increasingly intersected with trade negotiations, domestic manufacturing, supply chain resilience, and international competitiveness. Similarly, 1 year after launching an ambitious life sciences strategy, the European Commission is making progress toward positioning pharmaceutical innovation as a central component of Europe's broader competitiveness agenda—recognizing the sector’s importance not only for health outcomes but also for economic growth and technological leadership.
This broader shift was echoed during the HPLE, where discussions consistently framed pharmaceutical pricing as part of a larger policy conversation involving industrial strategy, geopolitical priorities, and international competitiveness. For HEOR professionals, this evolution suggests that future policy analyses may increasingly require perspectives extending beyond traditional reimbursement and pricing frameworks.
2. The debate is shifting from drug prices toward global burden-sharing for innovation.
The policy discussion surrounding MFN has increasingly highlighted a broader question: How should countries collectively finance pharmaceutical innovation?
Recent analyses from international organizations continue to demonstrate substantial differences in pharmaceutical spending across high-income countries, while the US government has increasingly framed these differences as part of a broader conversation regarding the global distribution of innovation costs. While there is no consensus on how countries should contribute to financing pharmaceutical innovation, the question has become prominent in global policy discussions.
This broader perspective also emerged during the HPLE. Rather than focusing exclusively on whether drug prices should increase or decrease, discussions explored how innovation should be financed globally, whether the current distribution of financing responsibilities is sustainable, and what mechanisms might better align incentives for future pharmaceutical innovation.
These questions are likely to remain central as countries continue exploring approaches to balancing affordability with sustained investment in biomedical innovation.
3. Government savings and patient affordability should not be assumed to be synonymous.
Improving affordability remains a shared policy objective across healthcare systems. However, recent policy discussions have increasingly distinguished between reducing public expenditure and the need to improve affordability for individual patients.
Experience with existing rebate structures (most notably in the United States and Germany) and ongoing pricing reforms illustrates that the distribution of savings depends heavily on benefit design, cost-sharing arrangements, and implementation mechanisms. Consequently, policies generating substantial government savings do not necessarily produce proportional reductions in patient out-of-pocket costs or improvements in patient access.
The HPLE reinforced this important distinction, highlighting the need to evaluate affordability from multiple perspectives, including government budgets, payer expenditures, benefit design, and patient experience.
As pricing reforms continue to evolve, evaluating not only the magnitude of savings but also how those savings are distributed across stakeholders will remain essential for informing future policy decisions.
4. Innovation depends on a broader ecosystem than pricing alone.
Discussions regarding the implications of drug pricing policies are extending beyond affordability to include potential impacts on pharmaceutical innovation.
Recent policy initiatives in both the United States and Europe emphasize that innovation depends on multiple interconnected factors, including regulatory predictability, public investment in research, scientific infrastructure, clinical trial capacity, skilled talent, intellectual property protections, and competitive commercial environments.
The HPLE reflected this broader perspective. While participants expressed differing views regarding the potential effects of MFN on pharmaceutical research and development, there was broad recognition that innovation is shaped by an ecosystem rather than any single pricing policy.
This systems perspective reinforces the importance of evaluating pharmaceutical policy within the broader context of research, regulation, investment, and healthcare delivery.
5. International reference pricing is elevating the importance of HTA and HEOR.
As policy makers increasingly look across borders when developing pharmaceutical pricing policies, the demand for transparency is also growing. International reference pricing, confidential pricing arrangements, and managed entry agreements have become increasingly common policy tools. While these approaches may support affordability objectives, they also make it more difficult to compare prices across jurisdictions and to understand how those prices were derived.
Discussions at the HPLE reinforced that pharmaceutical prices cannot be interpreted independently of the health systems that produce them. Prices reflect national priorities, health technology assessment methodologies, reimbursement policies, budgetary frameworks, and societal preferences. As countries increasingly look at one another when informing pricing decisions, understanding these underlying contexts becomes just as important as understanding the prices themselves.
This evolution is elevating the role of health technology assessment (HTA) and HEOR in healthcare decision making. Rather than relying solely on international price comparisons, policy makers increasingly require evidence that explains the value of new technologies, evaluates comparative clinical and economic outcomes, assesses budget impact, and examines the broader system-level implications of policy reforms. HTA and HEOR provide the analytical foundation needed to interpret complex policy environments and support transparent, evidence-informed decisions.
As pharmaceutical policy becomes more interconnected globally, strengthening the generation, interpretation, and application of evidence will be essential to ensure that pricing policies continue to support innovation, affordability, and patient access.
Looking Ahead
Although recent discussions have been catalyzed by the MFN initiative in the United States, the issues raised extend well beyond any single policy. Across countries, pharmaceutical policy is increasingly intersecting with trade, industrial strategy, innovation, evidence generation, and health system sustainability.
These developments suggest that future policy discussions increasingly will require multidisciplinary perspectives capable of evaluating both intended and unintended consequences across health systems.
The conversations at the HPLE reflected this broader mindset. Rather than offering definitive answers, they highlighted the importance of continued dialogue and robust analysis to support informed decision making in an interconnected global policy environment.
As a neutral convener, ISPOR remains committed to fostering these conversations and advancing the evidence needed to inform health policy decisions around the world.