White House Readies Drug Price Deals With AbbVie, Novartis, Roche

AbbVie Inc. (NYSE:ABBV) and several other drugmakers are reportedly expected to announce agreements with the U.S. government on Friday to cut select prescription drug prices and comply with additional policy demands from President Donald Trump.

Reuters on Tuesday highlighted that around five companies are expected to be included in the initial announcement.

In September, Pfizer Inc. (NYSE:PFE) announced the first agreement with the Trump Administration to ensure U.S. patients pay lower prices for their prescription medicines.

The administration is also set to outline a pilot program that would link Medicare drug payments to the lowest prices charged by manufacturers in a group of comparable foreign markets.

Also Read: AstraZeneca, GSK Among Executives Asked To Help Redesign UK Pricing Rules-Report

Who Is Cutting Deals?

In July, Trump sent letters to 17 major pharmaceutical companies calling for "most-favored-nation" pricing for Medicaid, limits on U.S. launch prices relative to other high-income countries, increased domestic reinvestment, and expanded direct-to-consumer sales models.

Five companies—Pfizer, Eli Lilly and Co (NYSE:LLY), AstraZeneca Plc (NASDAQ:AZN), Novo Nordisk A/S (NYSE:NVO), and EMD Serono Merck KGaA's (OTC:MKGAF) (OTC:MKKGY) U.S. unit—have already agreed to the terms.

The remaining companies yet to sign on include Sanofi SA (NASDAQ:SNY), Regeneron Pharmaceuticals Inc. (NASDAQ:REGN), Merck & Co Inc. (NYSE:MRK), Johnson & Johnson (NYSE:JNJ), AbbVie, Amgen Inc. (NASDAQ:AMGN), Gilead Sciences Inc. (NASDAQ:GILD), Boehringer Ingelheim, Bristol Myers Squibb & Co (NYSE:BMY), GSK Plc (NYSE:GSK), Novartis AG (NYSE:NVS), and Genentech, Roche Holdings AG's (OTC:RHHBY) U.S. unit.

Drug Price Gap Between USA And Global

Trump has repeatedly targeted the gap between U.S. drug prices and those in other developed countries, where government-run health systems negotiate prices before granting reimbursement.

On Tuesday, Bloomberg also reported that the White House is preparing to announce drug pricing agreements with Novartis and Roche as soon as Friday, a move that could further ease recent trade tensions with Switzerland following a tariff dispute.

Sources told Bloomberg that additional drugmakers may be included, though terms are still being finalized.

Switzerland last month secured a preliminary trade deal cutting tariffs on several domestic exports, including watches, to 15% from 39%, after facing the steepest levy imposed on any developed country. While pharmaceuticals were exempt from those tariffs, the administration had signaled the possibility of future duties.

Novartis told Bloomberg that it is in discussions with the administration and is focused on lowering U.S. drug costs while addressing pricing gaps between the U.S. and other high-income markets.

Price Action: Novartis shares were up 0.34% at $135.49, and AbbVie shares were up 0.36% at $225.11 at the time of publication on Thursday, according to Benzinga Pro data.

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