Trump promises cheaper drugs under TrumpRx, but economists say the long-term costs may be hidden

By Fox News · Fox News

As President Donald Trump rolls out his TrumpRx proposal to cut prescription drug prices, economists are raising questions about what happens when prices are capped and whether short-term savings for consumers come at the expense of future medical breakthroughs. On Friday, Trump announced deals with nine pharmaceutical companies to lower prices on certain medications for Americans, along with $150 billion in promised new investments in domestic manufacturing and pharmaceutical research. The announcement builds on the administration’s Trump Rx initiative, a government-run portal designed to steer consumers toward lower-cost prescription drugs offered directly by manufacturers. The program is central to Trump’s effort to tie U.S. drug prices to those paid in other wealthy countries, a policy known as "most favored nation" pricing. But economists caution that price-lowering agreements don’t eliminate costs and often shift them elsewhere, particularly into reduced drug development, delayed innovation, or higher prices in other parts of the market. TRUMP SECURES AGREEMENTS WITH MAJOR DRUGMAKERS TO LOWER MEDICAID PRESCRIPTION COSTS FOR AMERICANS Michael Baker, director of healthcare policy at the American Action Forum, said government price setting shifts costs rather than eliminating them. "At the most basic level, government price setting only limits what patients pay for a drug — usually reflected in an out-of-pocket or co-insurance payment," Baker said. "This does nothing to address the overall cost of the drug, which someone still has to pay, nor does it lower the cost associated with development." As a result, Baker said, patients ultimately bear those costs through tighter coverage rules, fewer treatment options or reduced future innovation. "Patients will experience far less of the crown jewel of the U.S. healthcare system that they are currently accustomed to receiving," he added. Economists say the effects of permanent price caps would also be felt upstream, in…