We Work For Health Statement on Foreign Reference Pricing for Medicaid
- gpuckrein
- May 5
- 2 min read
WASHINGTON, D.C. (May 5, 2025) — We Work For Health released the following statement in response to reports around foreign reference pricing for Medicaid:
The attempt to revive foreign reference pricing for prescription drugs – which has been referred to as “Most Favored Nation” (MFN) – is deeply troubling and strategically unsound. If this approach is permitted, drug pricing in America’s Medicaid program would be determined by drug costs in select foreign countries, each of which features a healthcare system and market complexities distinct from the United States.
First, this approach does nothing to fix Medicaid, which already receives best pricing for prescription drugs. Replacing that existing framework with foreign price controls would destabilize a system that has delivered medication accessibility for years.
MFN is a sure-fire way to cripple access for the very patients Medicaid is meant to serve. The flawed policy of MFN would delay or restrict access to new therapies and further weaken America’s position as a leader in healthcare access and innovation. In Germany and the U.K., for example, fewer than two-thirds of newly approved medicines reach patients, often after a 10-month delay or longer [1]. Incorporating that model into Medicaid would lead to fewer choices, longer wait times and diminished care for those who need it most.
In addition, foreign price-matching would disrupt a critical sector of the U.S. economy. The biopharmaceutical industry supports more than 4.9 million American employees, and its economic footprint can also be measured by its impact on the vendors that provide services or supplies to America's biopharmaceutical research companies. MFN threatens to crush private investment, weaken America’s global leadership in life sciences and slow the development of future cures.
To put it simply: MFN coupled with the unintended consequences of the Inflation Reduction Act, the pill penalty, tariffs uncertainty and the rise of China on the global biopharmaceutical stage are having a compounding, negative impact on America’s innovation ecosystem. The stakes of this inevitably flawed experiment are simply too high.
Reconciliation should allow Congress to chart a better course, one that strengthens, not weakens, American health care and innovation. MFN is a disastrous detour that should not be taken.