Pharmaceutical Giants Raise Prices on Hundreds of Drugs Despite Trump’s Pricing Push

Major pharmaceutical manufacturers implemented price increases on 872 brand-name drugs in the first two weeks of 2026, delivering a blow to American patients just weeks after President Trump announced voluntary pricing agreements with 16 of the nation’s largest drugmakers.The median increase came in at 4 percent, matching last year’s rate, though Pfizer raised the price of its COVID-19 vaccine Comirnaty by 15 percent. All 16 companies that inked deals with the Trump administration still raised some of their prices for 2026.The deals, nicknamed “most favored nation” arrangements, aim to align American drug prices with the lowest prices pharmaceutical companies charge in other developed nations. In exchange, participating companies receive three-year exemptions from threatened tariffs on imported pharmaceuticals.“The real truth serum is what’s happening in the marketplace after those deals occur,” Antonio Ciaccia, CEO of 46brooklyn Research, tells The New York Sun. “January is prime time for list price changes on brand-name drugs. So, in examining where we are today, we’re pretty much in line with the last few years.”In other words, voluntary promises from drugmakers have proven no match for the fundamental economics driving pharmaceutical pricing in America.The List Price DebateWhen asked about the January price increases, however, the White House said that list prices don’t really matter. The administration maintains that the specific discounts addressed in the voluntary deals will benefit state Medicaid programs and some cash-paying patients, even as list prices for the same medications climb.Yet for millions of Americans, those list prices matter significantly. Assistant Professor of Medicine at Harvard University, Dr. Benjamin Rome, underscores that many patients have insurance requiring them to pay deductibles and coinsurance directly linked to list prices.“When drug makers raise list prices, these patients pay more out-of-pocket,” Dr. Rome points out. “It’s true that Medicare patients are now protected by the $2000 annual out-of-pocket limit, although before they hit this limit, their costs are often directly tied to list prices. But for uninsured patients and those with private insurance, particularly those in high-deductible health plans, list prices are very meaningful.”In practical terms, many Americans face deductibles or copayments calculated as a percentage of a drug’s list price. When that list price jumps from $100 to $150, their pharmacy bill increases accordingly, regardless of what discounts insurers negotiate behind the scenes.Mr. Ciaccia, however, frames the issue as more complex than simple price tags suggest. “List prices matter and don’t matter at the same time,” he observes. “Public policy and broader market forces have failed to incentivize manufacturers to compete by lowering prices.”He explains that government rebate mandates in Medicaid, 340B, Medicare, and beyond, combined with exemptions that manufacturers and pharmacy benefit managers have to anti-kickback laws, create a dysfunctional system. “For many patients, like those in high-deductible health plans, those with cost sharing based on list prices, or those who lack coverage, these list prices that no one was supposed to pay are very real,” Mr. Ciaccia says.Industry JustificationsPharmaceutical companies defend the price increases as necessary investments in research and development. Pfizer told NPR its increases were modest and necessary, noting that net prices insurance companies pay after rebates have declined. GSK and Merck cited the need to support innovation and reflect clinical value.Dr. Rome challenges these justifications. “There’s a lot of evidence that drug prices do not have any relationship to the actual R&D costs for an individual product,” he explains. “Drug makers set prices as high as they think the market will bear, and that’s true for innovative drugs and ‘me-too’ drugs that are very similar to existing products.”Health policy experts, meanwhile, question whether these explanations hold up to scrutiny.“I believe them when they say R&D and innovation investments are legitimate needs to account for in their pricing decisions,” Mr. Ciaccia says. “But as publicly-traded companies, just like any layer of the drug channel or any other market segment, it is their fiduciary obligation to maximize shareholder value.”Not all news points toward higher costs. Eighteen significant price cuts occurred in early January, including four drugs subject to Medicare price negotiation under the Biden administration’s Inflation Reduction Act. The insulin Fiasp received a 75 percent price reduction, while diabetes medications Farxiga and Jardiance, along with the blood thinner Eliquis, also saw substantial price reductions.Medicare’s first-ever negotiated drug prices took effect January 1, 2026. After the first round of negotiations in 2024, prices for 10 drugs were reduced by 38 percent to 79 percent. Unlike Trump’s voluntary arrangements, the Medicare negotiations carry statutory force with published prices and penalties for non-compliance. The law also capped Medicare Part D out-of-pocket costs at $2,000 annually.Experts draw sharp distinctions between the two pricing strategies.Professor of Medicine at Harvard Medical School, Dr. Aaron Kesselheim, tells The Sun that Trump’s voluntary deals “were not really meaningful changes to the ways that drugs are made or paid for.”“These were arrangements so that people could score political wins and get favorable headlines,” Dr. Kesselheim says. “The fundamental (issue) wasn’t addressed.”He contrasts this with the Inflation Reduction Act. “That’s the sort of policy reform that we need,” Dr. Kesselheim continues. “For a very small number of drugs at the end of their market life, the government is negotiating their prices. There were real and meaningful reductions in out-of-pocket costs at the same time.”Comparing ApproachesWhen pressed on which strategy delivers results, health policy experts point decisively to statutory frameworks over voluntary commitments. According to Dr. Rome, the Medicare price negotiations passed by Congress are much more meaningful than the voluntary deals announced by the Trump administration. “The first prices negotiated by Medicare just went into effect this month, and the savings will grow over time as more drugs are negotiated,” he says. He also notes that the combination of negotiated prices and the $2,000 annual cap for Medicare patients “ensures that a lot of the government’s savings from negotiation are passed onto patients who need expensive medications.”“By contrast, it’s very difficult to know what the impact of the voluntary agreements will be,” Dr. Rome continues. “This is in part because we don’t know what the policies will do and how they’d be enforced. But even if we take the policies at face value, they mainly affect cash pay prices, and most Americans do not pay cash for brand-name prescription drugs but instead rely on their insurance coverage.”The Structural ChallengeMr. Ciaccia, however, cautions that neither approach is a cure-all. “The IRA did not unilaterally force manufacturers to lower their prices — it forced them to give discounts on their medicines, but not lower the actual prices,” he says, referring to the Inflation Reduction Act passed by Congress in 2022.Mr. Ciaccia warns that discount-focused programs create perverse incentives.“If Medicaid, Medicare, and 340B are all discount-focused purchasing arrangements, then it puts pressure underneath list prices, which drives them higher in general,” he underscores. “Government insulates itself from the harms of a dysfunctional marketplace, and it becomes employers and patients who are thrown to the wolves.”In essence, when government programs negotiate discounts off the list price rather than capping the list price itself, manufacturers compensate by raising those list prices even higher. Government programs are insulated through their negotiated discounts, yet employers and privately insured patients, whose costs are often tied directly to list prices, end up paying more. The persistence of January price increases despite political pressure from both parties underscores a fundamental problem: Unlike every other high-income country, the United States allows pharmaceutical companies to charge whatever they want after FDA approval.“In every other high-income country around the world, there’s a process of negotiation based on health technology assessments that are made about how good the drug is compared to alternative treatments,” Dr. Kesselheim says.Despite 95 percent of Americans saying drug prices are too high, reform remains elusive. “The pharmaceutical industry is one of the most powerful lobbying forces in the country. They have unbelievable resources,” Dr. Kesselheim says.Voluntary agreements, experts stress, lack teeth. “There’s no mechanism for following up or enforcing them,” Dr. Kesselheim adds. “The drug companies report in their earnings reports that these agreements are not changing the bottom line at all for the companies, nor are their stock prices affected under these circumstances.”

Pharmaceutical Giants Raise Prices on Hundreds of Drugs Despite Trump’s Pricing Push

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