Executive Order 14297 aims to address what it characterizes as an "egregious imbalance" in global pharmaceutical pricing, where Americans fund approximately three-quarters of global pharmaceutical profits despite representing less than five percent of the world's population. The order frames this situation as a "purposeful scheme" where manufacturers offer discounted prices to foreign markets while charging substantially higher prices to American consumers. According to the order, this price discrimination forces Americans to subsidize both pharmaceutical companies and other countries, while simultaneously benefiting from American taxpayer-funded research through the National Institutes of Health and public healthcare programs. The administration asserts that Americans deserve the same low-cost pharmaceuticals available to other developed nations.
The order outlines multiple mechanisms to achieve most-favored-nation pricing for American patients. Within 30 days, the Secretary of Health and Human Services must communicate price targets to pharmaceutical manufacturers to align American prices with those in comparably developed nations. If significant progress isn't achieved, the Secretary must propose rules to impose most-favored-nation pricing and may certify drug importation under section 804(j) of the Federal Food, Drug, and Cosmetic Act. Additional enforcement measures include directing the Attorney General and FTC Chairman to address anti-competitive practices, reviewing pharmaceutical exports that may contribute to price discrimination, potential modification or revocation of drug approvals, and facilitation of direct-to-consumer purchasing programs for manufacturers willing to offer most-favored-nation pricing to Americans.
Implementation responsibility falls primarily to the Secretary of Health and Human Services, working in coordination with the Assistant to the President for Domestic Policy, the CMS Administrator, and other relevant agency officials. The Secretary of Commerce and United States Trade Representative are directed to address what the order terms as "foreign countries freeloading on American-financed innovation" through appropriate trade actions. The Attorney General and FTC Chairman are tasked with enforcing antitrust laws against anti-competitive practices identified in a previously ordered report. The order emphasizes that all implementation must be consistent with applicable law and subject to available appropriations. If pharmaceutical manufacturers fail to meet the administration's price targets within 30 days, the more aggressive enforcement mechanisms would begin to take effect.