Most Favored Nation
News Updates
Incubate is tracking the life sciences impacts of the Trump administration's Most Favored Nation (MFN) drug pricing policy, which seeks to tie U.S. prescription drug prices to those in countries that impose strict price controls.
Cero Therapeutics Holdings Inc
Negative Outlook
South San Francisco, CA
1-50 employees
On May 12, 2025, President Trump signed the executive order titled “Delivering Most-Favored-Nation Prescription Drug Pricing,” which directs the Secretary of Health and Human Services (“HHS”) to identify and communicate most-favored-nation price targets for prescription drugs and to propose a rulemaking plan to impose such pricing if “significant progress” is not made. The order also directs the federal government to explore regulatory pathways that would facilitate direct-to-patient sales for manufacturers that meet these price targets. Additionally, it signals potential further action against manufacturers that fail to offer most-favored-nation pricing, including evaluating whether to modify or rescind marketing approvals or allow individual drug importation waivers.
NRX Pharmaceuticals Inc
Neutral Outlook
Wilmington, DE
1-50 employees
“FDA further augmented the potential path to market of NRX-100 by establishing the Commissioner’s National Priority Voucher Program (CNPV). The key criteria are shown below, taken from the FDA website. To receive a CNPV, a product must meet at least one of the criteria below. Management believes that NRX-100 meets all five criteria.
●Addressing a U.S. public health crisis. An example could include developing a universal flu vaccine that could provide broad protection against multiple strains of influenza, including those with pandemic potential.
●Delivering more innovative cures for the American people. The focus for this priority is transformative impact that far outstrips the threshold for breakthrough therapy designation. Examples could include creating a novel immunotherapy that reprograms the body’s immune system to fight multiple diseases; or transforming mental health care through a novel treatment for PTSD.
●Addressing a large unmet medical need. This includes a condition that available therapies do not adequately diagnose or treat, including drugs to treat or prevent rare diseases or addressing America’s chronic disease crisis.
●Onshoring drug development and manufacturing to advance the health interests of Americans and strengthen U.S. supply chain resiliency. Examples could include companies with new manufacturing establishments that shift manufacturing of essential medicines (such as generic sterile injectables) from foreign facilities to the U.S.; or a clinical trial that maintains robust U.S. enrollment to support generalizability for Americans against the U.S. standard of care.
●Increasing affordability. This could include a company that lowers the U.S. price of a drug or drugs consistent with Most Favored Nation pricing or reduces other downstream medical utilization to lower overall healthcare costs.”
Candel Therapeutics
Neutral Outlook
Needham, MA
1-50 employees
On May 12, 2025, the Trump Administration published Executive Order 14297, “Delivering Most-Favored-Nation Prescription Drug Pricing to American Patients” which generally, among other things, directs the federal government to establish and communicate most-favored-nation price targets to pharmaceutical manufacturers to bring prices for American patients in line with comparably developed nations. Further, the Executive Order directs the federal government to support regulatory paths to allow direct-to-patient sales for companies that meet these targets. It also states that the Administration will take additional aggressive action (for example, examining whether marketing approvals should be modified or rescinded or opening the door for individual drug importation waivers) should manufacturers fail to offer American consumers the most-favored-nation lowest price. It also directs the Secretary of Commerce and the U.S. Trade Representative to “take all necessary and appropriate action to ensure foreign countries are not engaged in any act, policy, or practice that may be unreasonable or discriminatory or that may impair United States national security . . . including by suppressing the price of pharmaceutical products below fair market value in foreign countries.”
Zura Bio Ltd
Negative Outlook
Henderson, NV
1-50 employees
Current or future tariffs will result in increased research and development expenses, including with respect to increased costs associated with APIs, raw materials, laboratory equipment and research materials and components. In addition, such tariffs will increase our supply chain complexity and could also potentially disrupt our existing supply chain. Unlike consumer goods, pharmaceuticals face unique regulatory constraints that make rapid supply chain adjustments particularly difficult and costly. Trade restrictions affecting the import of materials necessary for clinical trials could result in delays to our development timelines. Increased development costs and extended development timelines could place us at a competitive disadvantage compared to companies operating in regions with more favorable trade relationships and could reduce investor confidence, negatively impacting our ability to secure additional financing on favorable terms or at all. As we advance toward commercialization in the future, tariffs and trade restrictions could hinder our ability to establish cost-effective production capabilities, negatively impacting our growth prospects. In addition, in the event Most-Favored-Nation pricing for pharmaceutical products is implemented and applicable to any of our product candidates that may receive regulatory approval, our revenue opportunities may be adversely affected.
Fortress Biotech
Negative Outlook
Bay Harbor Islands, FL
1-50 employees
In addition, on May 12, 2025, President Trump issued an executive order implementing the concept of most-favored nation pricing. Under this order, the Department of Health and Human Services, in coordination with other federal agencies, is directed to take actions to ensure that the price of prescription drugs paid by federal health insurers, including Medicare and Medicaid, is in line with the prices paid in comparably developed nations. Any reduction in reimbursement from Medicare, Medicaid, or other government programs may result in a similar reduction in payments from private payers.
Werewolf Therapeutics
Neutral Outlook
Watertown, MA
1-50 employees
On May 12, 2025, the Trump Administration published Executive Order 14297, “Delivering Most-Favored-Nation Prescription Drug Pricing to American Patients” which generally, among other things, directs the federal government to establish and communicate most-favored-nation price targets to pharmaceutical manufacturers to bring prices for American patients in line with comparably developed nations. Further, the Executive Order directs the federal government to support regulatory paths to allow direct-to-patient sales for companies that meet these targets. It also states that the Administration will take additional aggressive action (for example, examining whether marketing approvals should be modified or rescinded or opening the door for individual drug importation waivers) should manufacturers fail to offer American consumers the most-favored-nation lowest price. It also directs the Secretary of Commerce and the U.S. Trade Representative to “take all necessary and appropriate action to ensure foreign countries are not engaged in any act, policy, or practice that may be unreasonable or discriminatory or that may impair United States national security…including by suppressing the price of pharmaceutical products below fair market value in foreign countries.”
Forte Biosciences
Negative Outlook
Dallas, TX
1-50 employees
Further, the current administration has issued executive orders focused on decreasing prescription drug prices, including directing the Secretary of Health and Human Services to establish a mechanism through which American patients can buy drugs directly from manufacturers who sell at a most-favored-nation price and directing the U.S. Trade Representative and Secretary of Commerce to take action to ensure foreign countries are not engaged in practices that purposefully and unfairly undercut market prices and drive price hikes in the United States. If HHS begins to set most-favored-nation pricing targets for prescription drugs, including the use of international pricing reference to set drug prices in the United States, or increases generic and biosimilar drug entry sooner than expected, that can have a material adverse effect on our industry, ability to set adequate pricing for new drugs to recover R&D costs, ability to attract potential investors and potential buyers in the future. We cannot predict the full impact of the executive orders focused on reducing prescription drug prices or increasing domestic drug manufacturing capacity, or other measures that may be implemented by the current administration related to drug pricing, drug supply chain and manufacturing in the United States.
Inhikibase Therapeutics
Neutral Outlook
Wilmington, DE
1-50 employees
On May 12, 2025, the Trump Administration published Executive Order 14297, “Delivering Most-Favored-Nation Prescription Drug Pricing to American Patients” which generally, among other things, directs the federal government to establish and communicate most-favored-nation price targets to pharmaceutical manufacturers to bring prices for American patients in line with comparably developed nations. Further, the Executive Order directs the federal government to support regulatory paths to allow direct-to-patient sales for companies that meet these targets. It also states that the Administration will take additional aggressive action (for example, examining whether marketing approvals should be modified or rescinded or opening the door for individual drug importation waivers) should manufacturers fail to offer American consumers the most-favored-nation lowest price. It also directs the Secretary of Commerce and the U.S. Trade Representative to “take all necessary and appropriate action to ensure foreign countries are not engaged in any act, policy, or practice that may be unreasonable or discriminatory or that may impair United States national security . . . including by suppressing the price of pharmaceutical products below fair market value in foreign countries.”
Tvardi Therapeutics
Neutral Outlook
Sugar Land, TX
1-50 employees
These and other healthcare reform measures may be adopted in the future, particularly in light of the recent U.S. presidential and congressional elections and may result in more rigorous coverage criteria and in additional downward pressure on the price that we receive for any approved drug. The current presidential administration is pursuing policies to reduce regulations and expenditures across government including at HHS, the FDA, Centers for Medicare & Medicaid Services (CMS) and related agencies. These actions, presently directed by executive orders or memoranda from the Office of Management and Budget, may propose policy changes that create additional uncertainty for our business. These actions and proposals include, for example,
(1) reducing agency workforce and cutting programs;
(2) rescinding a previous executive order tasking the Center for Medicare and Medicaid Innovation to consider new payment and healthcare models to limit drug spending;
(3) eliminating the previous executive order that directed HHS to establish an AI task force and develop a strategic plan;
(4) directing HHS and other agencies to lower prescription drug costs for Medicare through a variety of initiatives, including by improving upon the Medicare Drug Price Negotiation Program and establishing Most-Favored-Nation pricing for pharmaceutical products;
(5) imposing tariffs on imported pharmaceutical products; and
(6) directing certain federal agencies to enforce existing law regarding hospital and plan price transparency and by standardizing prices across hospitals and health plans.
IO Biotech
Negative Outlook
Denmark
51-200 employees
For example, on May 12, 2025, President Trump issued an Executive Order directing federal agencies including the Department of Health and Human Services (“HHS”) to pursue a “most-favored-nation” (“MFN”) pricing policy for certain prescription drugs, which would tie prices paid by Medicare to the lowest price available in certain other developed countries. The scope, timing, and implementation details of the MFN policy remain uncertain and may be subject to legal challenges, regulatory rulemaking, and changes in administrative priorities. If implemented, this policy could have a material impact on the pricing and reimbursement of our products in the United States, particularly those covered under Medicare Part B or Part D. Potential effects include reduced pricing flexibility, downward pressure on reimbursement rates, and changes to market access dynamics. The MFN policy could also influence pricing negotiations with commercial payors and international markets. Because the outcome, timing, and specifics of this policy are uncertain, we cannot predict its ultimate effect on our business, financial condition, results of operations, or prospects, but the impact could be material and adverse.