April 22, 2025
Reuters recently published an article featuring Rena Conti, Associate Professor of Markets, Public Policy, and Law, discussing a controversial policy under consideration by the Trump administration, tying U.S. drug prices to those in other developed countries, a strategy known as international reference pricing.
The proposal has sparked concern among pharmaceutical companies, who argue it could destabilize the healthcare market and stifle innovation in drug development. Critics also caution that the policy may be difficult to enforce and could lead to unexpected ripple effects, such as drugmakers adjusting prices internationally to protect profits.
“Drugmakers could also respond by re-negotiating contracts with reference countries to increase prices, raising the bar for prices in the U.S. and generating higher revenue abroad,” Conti adds.
As the administration considers the proposal, significant logistical and economic challenges remain, raising concerns about its potential impact on the global pharmaceutical market.
