Early Global Responses to MFN Signal Shifts in Pricing and Access

The ISPOR Policy Brief offers concise insights into emerging developments in the global health policy space that shape access, innovation, and affordability. Each monthly installment spotlights timely issues with relevance for the health economics and outcomes research (HEOR) community and beyond, which provides readers with a rapid overview of how policy shifts are influencing global markets and stakeholders.

Ana Amaris, MD, MPH, Director, Health Policy Initiatives, ISPOR, Lawrenceville, NJ, USA

Overview: This issue focuses on recent developments related to Most-Favored-Nation (MFN) drug pricing policies in the United States and their emerging global implications. It highlights how new policy tools, including trade-linked measures and institutional changes, are beginning to influence pricing strategies, industry behavior, and the broader policy environment.

US Updates & Perspectives

US Government Ties Pharmaceutical Tariffs to MFN Pricing and Domestic Manufacturing

The White House announced in early April the imposition of tariffs of up to 100% on imported patented pharmaceuticals and their ingredients, citing national security and supply chain resilience concerns.

The policy introduces a tiered tariff structure:

• 0% tariffs for companies that enter into MFN pricing agreements and commit to onshoring production and R&D

• 20% tariffs for companies with approved onshoring plans but no MFN agreement (increasing to 100% over time)

• 100% tariffs for companies that do not comply with MFN or domestic manufacturing expectations

Preferential rates apply under existing trade agreements, and several categories (including generics, orphan drugs, and certain specialty therapies) are exempt.

The measure explicitly frames pharmaceutical imports as a national security risk, positioning tariffs as a tool to incentivize both price alignment (via MFN) and domestic manufacturing capacity.

White House Proposes US Department of Health and Human Services (HHS) Restructuring, 340B Oversight Shift, and Support for Domestic Manufacturing

The Trump administration’s proposed 2027 budget includes a 12.5% reduction in funding for HHS, alongside a broader reorganization of federal health agencies. The proposal would consolidate multiple entities—including the Health Resources and Services Administration (HRSA), the Office of the Assistant Secretary for Health, several centers and programs within the Centers for Disease Control and Prevention, and the Substance Abuse and Mental Health Services Administration—into a new entity, the Administration for a Healthy America.

The budget also proposes shifting oversight of the 340B Drug Pricing Program from the HRSA to the Centers for Medicare & Medicaid Services, citing the latter agency’s greater in-house expertise in drug pricing and reimbursement.

In parallel, proposed provisions related to the US Food and Drug Administration aim to promote US-based drug development and manufacturing, including facilitating early stage clinical trials in the United States and strengthening the position of domestic manufacturers.

MFN Begins to Influence Pricing, Decision Making, and Global Policy Dynamics

Recent expert commentary suggests that MFN is evolving beyond a pricing proposal into a broader policy framework with real behavioral effects. Even in the absence of fully defined implementation mechanisms, the combination of pricing pressure, bilateral negotiations, and trade-linked incentives is already influencing manufacturer decisions on pricing, investment, and market strategy.

Some analyses raise fundamental questions about how drug prices should be determined under MFN approaches. By anchoring prices to external benchmarks, the policy risks shifting decision making away from value-based frameworks grounded in health technology assessment (HTA) and toward more mechanical forms of price convergence. This creates uncertainty around what constitutes a “fair” price in the US context and whether reliance on international references can substitute for domestically grounded value assessment.

From a global perspective, experts note that these dynamics may have broader implications for how value is defined and negotiated across health systems. As pricing becomes increasingly interdependent, the role of national HTA processes may be challenged by externally driven pressures, potentially reshaping both evidence expectations and access pathways.

International Updates

South Korea Advances Pricing Reforms While Navigating Global Pricing Exposure

South Korea, one of the reference countries considered in MFN pricing discussions, is advancing a broad reform of its pharmaceutical pricing system, with measures aimed at improving access to innovative therapies while tightening cost controls on generics and off-patent medicines.

Proposed changes include accelerated reimbursement timelines for rare disease treatments and expanded use of flexible pricing agreements alongside reductions in reimbursement levels for generics. While the reforms seek to rebalance incentives toward innovation and system sustainability, analysts warn that the changes may introduce market instability, particularly for manufacturers facing increased pricing pressure in the off-patent segment.

Manufacturers Delay European Launches as MFN Influences Global Strategies

Pharmaceutical companies are increasingly delaying or reconsidering the launch of new medicines in European markets, citing uncertainty related to US pricing reforms under MFN policies, as shown in recent reports. Industry data indicate a decline in European drug launches as manufacturers seek to avoid lower-priced markets that could influence US pricing benchmarks.

There are growing indications of fewer early access applications and delayed market entry decisions, reflecting concerns that US pricing policies may influence global launch sequencing and contribute to delayed access in lower-priced markets.

Japanese Pharmaceutical Companies Face Pricing Pressures Amid Policy Shifts

Japanese pharmaceutical companies, including major players such as Astellas, are navigating increasing pricing pressures both domestically and internationally. Ongoing reforms in Japan’s pricing system, combined with global shifts in pricing expectations, are contributing to a more challenging commercial environment for innovative medicines.

These developments highlight broader concerns about the sustainability of current pricing models and the potential for global policy changes, including those originating in the United States, to influence pricing strategies and investment decisions across markets.