Through executive orders, the current U.S. administration has been taking steps to reduce drug prices, and consistent with these executive directives, in December 2025, CMS issued proposed rules establishing two mandatory drug payment models that would introduce MFN pricing principles into Medicare drug reimbursement. These proposals remain subject to notice-and-comment rulemaking and may face legal or administrative challenges. Separately, in November 2025, CMS introduced a voluntary MFN-based framework for manufacturers participating in the Medicaid Drug Rebate Program. Although participation is voluntary, the model could nonetheless influence manufacturer pricing strategies and broader market dynamics by encouraging alignment of U.S. Medicaid prices with international reference pricing benchmarks. See Item 1 “Business—Government Regulation and Product Approval—Pharmaceutical Insurance Coverage and Health Care Reform” in the 2025 Annual Report for additional information regarding these laws, regulations and orders.
