President Trump’s State of the Union address included several healthcare proposals with potential benefits. Expanding access to patient-owned health savings accounts and routing federal subsidies through them—rather than insurance companies—would empower consumers to spend their healthcare dollars as they see fit. Stronger price transparency requirements would also foster competition.
However, one proposal the president continues to champion moves American healthcare in the opposite direction: his push for “most-favored-nation” drug pricing.
This policy would require pharmaceutical manufacturers to sell medicines in the United States at prices no higher than those charged in certain other developed countries. The president has encouraged companies to align U.S. prices with foreign ones and is urging Congress to codify this approach into law.
The political appeal is clear: U.S. drug prices are roughly 2.8 times higher than those in 33 peer countries analyzed by RAND. But lower foreign prices result not from superior bargaining but from government price controls. Countries like Canada, the United Kingdom, and much of Europe cap what they are willing to pay for new medicines. If manufacturers refuse, the drug may become unavailable to patients.
Codifying MFN would import those foreign price ceilings into the United States—along with the value judgments that underpin them. Foreign health systems often rely on a metric called the quality-adjusted life year (QALY) when determining drug coverage. The QALY attempts to assign a monetary value to one additional year of life, adjusted for health status.
In the United Kingdom, the National Institute for Health and Care Excellence (NICE) typically covers treatments only if they cost less than £20,000 to £30,000 per QALY—roughly $27,000 to $40,000. British authorities recently raised this threshold to £25,000 to £35,000 per QALY in April 2026, partly due to pressure from the Trump administration.
If a drug’s price per additional year of healthy life exceeds that range, NICE typically does not cover it—regardless of how urgently patients need it.
The QALY framework has troubling implications. Treatments extending lives for elderly, disabled, or chronically ill patients often generate fewer “quality-adjusted” years by definition. While the metric does not explicitly devalue some lives, its calculus can have that effect.
Federal law prohibits Medicare from using QALYs to determine coverage or impose cost-effectiveness thresholds. Codifying MFN would not formally authorize such use in the United States but would peg prices to countries that rely heavily on them.
In other words, it would subject Americans to the value judgments of foreign bureaucrats—and the rationing decisions that follow.
Price controls also hinder innovation. The U.S. accounts for more than half of global new drug development, and this leadership depends on earning returns on massive research investments. When governments cap prices, innovation slows and breakthroughs decline.
Additionally, countries with strict price controls delay access to new medicines. As of October 2022, only 59% of drugs launched globally between 2012 and 2021 were available in the United Kingdom; in Canada, just 45%. By contrast, 85% of those drugs reached U.S. patients.
Why would Congress adopt policies that deny cutting-edge therapies to citizens? And why would it enshrine laws that discriminate against elderly, chronically ill, and disabled people?
Importing lower drug prices from abroad may seem fair, but it would be a dangerous bargain for Americans.
Sally C. Pipes is President, CEO, and Thomas W. Smith Fellow in Healthcare Policy at the Pacific Research Institute. Her latest book is The World’s Medicine Chest: How America Achieved Pharmaceutical Supremacy — and How to Keep It.
