President Trump also refused to promise pharma execs that he would hamstring the IRA’s drug negotiation program.
President Donald Trump told leaders of the biggest pharmaceutical companies that they could face tariffs if they fail to relocate their manufacturing operations to the U.S., according to reporting from Blooomberg.
Citing two sources familiar with the matter, Bloomberg reported that pharma execs, at a private meeting with the president on Saturday, also failed to secure Trump’s commitment that he would weaken the Biden administration’s Inflation Reduction Act (IRA), under which the drug price negotiation program allows the Centers for Medicare and Medicaid Services to set lower prices for some of the most widely prescribed medicines.
The meeting was between the president and the lobbying group Pharmaceutical Research and Manufacturers of America (PhRMA), with Pfizer CEO Albert Bourla newly elected as board of directors chair. Also present were Eli Lilly CEO David Ricks, Merck CEO Robert Davis and PhRMA CEO Stephen Ubl, according to Bloomberg.
The industry has long been trying to neuter the IRA, arguing that the negotiation program is, in practice, coercive and constitutes a forceful taking of the companies’ properties without proper compensation. Several lawsuits have been filed seeking to block the IRA, though all have seen limited success so far.
When Trump won the U.S. presidential election last year, many in the industry were optimistic that the IRA would be scaled back, pointing to Project 2025’s provision that the drug price negotiations “should be repealed.”
Still, while a complete repeal of the law is unlikely, the Trump administration could instead target certain parts of the IRA, particularly the so-called pill penalty, which sets a shorter time in which small molecule drugs are protected from the negotiations, as opposed to biologics. The industry is asking Trump to make this negotiation blackout the same regardless of modality—though he has yet to give them his word, as per the Bloomberg report.
Another sticking point for the industry Is the strict anti-trust regulations under the Biden administration. Many analysts have seen Trump as a pro-business president and were carefully optimistic about the prospects of dealmaking under his second tenure.
In a November 2024 note, Jefferies quoted Quant strategist Desh Peramunetilleke, writing that a Trump leadership would likely be “more friendly towards M&A.” Mizuho agreed, writing in a November note that “there is no doubt this administration—at least on paper—will be far more amicable when it comes to business combinations,” according to Endpoints News.
As in the case of the IRA, however, this hope has so far been in vain. Last week, the Federal Trade Commission said that it would stick to the 2023 guidelines for mergers, which adopted stricter anti-trust measures.
