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Bipartisan Bill Aims to Slash Drug Prices by Tying Costs to International Averages

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Key Takeaways

  • The proposed legislation links US drug prices to those in Canada, France, Germany, Japan, Italy, and the UK.
  • Violators of the pricing cap would face fines 10 times the price difference per unit sold.
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The goal of the proposed bill is to “make prescriptions affordable again” in the US.

In a show of bipartisanship, US Senators Josh Hawley (R, Missouri) and Peter Welch (D, Vermont) have introduced legislation aimed at curbing skyrocketing prescription drug costs for Americans by linking US prices to those paid in other developed countries.1

The Fair Prescription Drug Prices for Americans Act proposes to prohibit pharmaceutical companies from charging Americans more than the average price of a drug or biological product in 6 other countries: Canada, France, Germany, Japan, Italy, and the United Kingdom. If passed, the bill would prohibit pharmaceutical companies from charging American consumers more than the international average price for medications. According to a news release, violators will be hit with steep financial penalties, including a fine 10 times the price difference of the drug per unit sold.2

Money with judges gavel on top | Image credit: RomanR – stock.adobe.com

The HHS secretary would be responsible for annually calculating the average international drug price. | Image credit: RomanR – stock.adobe.com

“For too long, Americans have subsidized prescription drug costs for foreigners while paying outrageous prices for their own medications,” Hawley said in the news release. “President Trump previously advanced major reforms to ensure that American patients pay the same prices as consumers abroad. This bipartisan legislation would continue that work to end a drug market that favors Big Pharma, make prescriptions affordable again, and empower Americans to get the care they need.”

The major reforms Hawley referred to date back to 2018, when Trump signed the Patient Right to Know Drug Prices Act into law after it passed in the House and Senate.3 This was also when he proposed a CMS International Pricing Index that would’ve gone into effect spring 2020 but was shot down after more than 300 groups argued that it would put vulnerable Medicare Part B beneficiaries at risk by restricting short-term access and reducing incentives for long-term medical advancements.4

Since Trump’s return to office, Senators Chuck Grassley (R, Iowa) and Maria Cantwell (D, Washington) have reintroduced 2 other bipartisan bills to tackle prescription costs and transparency: the Prescription Pricing for the People Act and the Pharmacy Benefit Manager (PBM) Transparency Act.5 The latest bill from Hawley and Welch “would correct decades of policies that benefited pharmaceutical companies but left American patients holding the bag,” according to the news release.2 Welch, a longtime critic of the pharmaceutical industry and advocate for lower drug prices, highlighted the personal toll of high costs.

“No one should ever be forced to choose between paying for the prescriptions they need or putting food on the table,” he emphasized. “But Big Pharma’s price gouging has made that a reality for many Americans, forcing them to pay four or five times more for the same lifesaving medications as folks in other countries—it’s unacceptable.”

The bill also noted that the HHS Secretary—currently Robert F. Kennedy Jr—would be responsible for annually calculating the average international price using a mix of manufacturer-reported data and publicly filed pricing data from the 6 referenced countries.1

References

  1. Fair Prescription Drug Prices for Americans Act, 119th Congress, 1st Sess (2025).
  2. In bipartisan push, Welch and Hawley introduce major legislation to lower prescription drug prices. Peter Welch. May 5, 2025. Accessed May 6, 2025. https://www.welch.senate.gov/in-bipartisan-push-welch-and-hawley-introduce-major-legislation-to-lower-prescription-drug-prices/
  3. Joszt L. Trump proposes allowing Medicare to base drug prices on what other countries pay. AJMC®. October 25, 2018. Accessed May 6, 2025. https://www.ajmc.com/view/trump-proposes-allowing-medicare-to-base-drug-prices-on-what-other-countries-pay
  4. Inserro A. More than 300 groups seek halt to CMS' plans for global drug pricing index. AJMC. December 10, 2018. Accessed May 6, 2025. https://www.ajmc.com/view/more-than-300-groups-seek-halt-to-cms-plans-for-global-drug-pricing-index
  5. Grassley, Cantwell reintroduce bills to lower prescription drug prices, drive PBM accountability. Chuck Grassley. February 12, 2025. Accessed May 6, 2025. https://www.grassley.senate.gov/news/news-releases/grassley-cantwell-reintroduce-bills-to-lower-prescription-drug-prices-drive-pbm-accountability
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