Trump’s 600% Price Cuts On Drugs Are Nowhere To Be Found, But Spending Growth Has Slowed

Donald Trump is apparently not very good at arithmetic, but spending on drugs has slowed. We have not seen the 600 percent price reductions he has boasted about (yes, that is absurd; it would mean drug companies are paying us to use their drugs), but some prices are lower. 

Trump has taken advantage of the negotiating power given the president by Biden’s Inflation Reduction Act (IRA) to negotiate lower prices for several important drugs. Under the IRA, the number of drugs subject to price negotiation will continue to expand, which will help to limit spending increases in future years.

As a result, the rate of increase in spending on pharmaceuticals has slowed to just 1.8 percent over the 12 months from July 2025 to July 2026, the most recent month available. That’s down from an increase of 7.6 percent in the prior 12 months, and 8.9 percent in the year to July 2024. 

This slowing is good progress, but it still has the US paying far more for drugs per person ($5,700 per household) than people in other wealthy countries. If we got the cost down to the average for other countries, we would save around $370 billion a year. If we got rid of government-granted patent monopolies and other forms of protection, we would save more than $500 billion a year or $4,000 per household. Remember, drugs are cheap; government-granted patent monopolies make them expensive.

In any case, we should be pleased with the progress we are seeing. It shows one of the benefits of the IRA, which was focused on promoting the green transition, that Trump has chosen not to gut.