The only good MFN Is no MFN
Americans are continually worried about the cost of healthcare. There are a plethora of good and bad ideas to make healthcare more affordable, including Most Favored Nation (MFN) price controls, which would import prices for pharmaceuticals from other countries, many of which rely on socialized medicine and government-run healthcare. But price controls in any industry, including biopharmaceuticals, do not work and will inevitably lead to shortages and disrupt markets. Suggesting that free market principles and price caps are compatible with MFN is nonsensical, since the federal government would be setting U.S. prices based on artificially low prices from other countries that free-ride off of U.S. biopharmaceutical research.
Citizens Against Government Waste (CAGW) made clear the pitfalls of MFN in an August 11, 2020, coalition letter to President Trump signed by 63 organizations, its June 26, 2025, comments to the United States Trade Representative, a November 24, 2025, blog post, and a February 12, 2026, coalition letter signed by 52 organizations opposing the codification of MFN by Congress. The letters and comments noted how the adoption of strict price controls in European countries led to the U.S. going from funding 40.8 percent of research in 1990 to 58.3 percent in 2017, turning them from the leader in biopharmaceutical research and development to lagging behind the U.S. The U.S. should not follow Europe’s lead and adopt policies that undermine the nation’s position as the global leader in biopharmaceutical innovation, research and development.
Adopting MFN price controls would also harm patients. According to an August 2022 University of Chicago issue brief, price controls would increase healthcare spending by $50.8 billion over the next 20 years and lead to 135 fewer drugs, which will negatively impact 2.47 million patients.
During President Trump’s first term, the Council of Economic Advisers’ February 2020 report found that American patients pay more for biopharmaceutical drugs because of free-riding and price controls by foreign countries, and that reducing both would increase competition and lower drug prices for American patients. Rather than implementing MFN price controls on drugs, lawmakers should leverage trade deals to force foreign countries to end their free-riding and price controls. A good example is the December 2025 U.S.-U.K. pharmaceutical pricing agreement under which the U.K. would pay 25 percent more for U.S. drugs.
President Trump is right to focus on lowering healthcare prices, but MFN is the wrong approach. MFN imports socialist price controls, further entrenches the government in healthcare, does nothing to address foreign free-riding, undermines America’s position as a global leader in biopharmaceutical research and development and innovation to the benefit of China, and harms patients by reducing the number of new medicines that reach the market.
In addition to pressuring other countries to sign more favorable trade agreements, President Trump and Congress should agree to reforms that promote free markets and protect intellectual property rights in a manner that would increase innovation and competition. This would reduce pharmaceutical costs, increase patient choice, and enable the research and development needed for more treatments and cures.
