Washington’s Most Favored Nation Policy: What It Means for Drug Pricing – and Why the Right PBM Partner Matters 

In May 2025, the Trump administration issued an executive order aimed at reducing prescription drug prices in the United States. While the primary focus has been on implementing most favored nation (MFN) drug pricing for Medicare and Medicaid, the order also directs Health and Human Service (HHS) to facilitate MFN direct-to-consumer purchasing programs for pharmaceutical manufacturers and extend MFN pricing to all markets, including the private sector. 

This sweeping policy raises significant legal and logistical questions for employers about if, when, and how it will be enacted. For HR professionals, it’s essential to understand the policy’s scope, how stakeholders across the supply chain are responding, and what steps you can take to prepare your organization and support your employees.

With drug pricing changes and rising uncertainty, choosing a PBM you can trust for clear pricing and standout service matters more than ever.

MFN pricing

MFN pricing refers to a policy approach in which the U.S. government seeks to pay no more for prescription drugs than the lowest price charged to peer countries in the Organization for Economic Co-operation and Development (OECD). However, the executive order does not explain how HHS or manufacturers should calculate MFN prices or how compliance will be monitored. This lack of clarity creates significant challenges. OECD countries negotiate prices through different mechanisms, include different rebates and discounts, and often use reference pricing or cost-effectiveness thresholds that don't exist in the U.S. system. Determining a true "lowest price" across these varied approaches is far from straightforward.

The administration followed the executive order with a July 31 letter to 17 drug makers calling on them to provide Medicaid with MFN pricing on their “full portfolio of existing drugs” and to “contract with the United States to guarantee Medicare, Medicaid and commercial payers receive MFN prices on all new drugs––both upon launch and moving forward.” 

Direct-to-consumer (DTC)

Direct-to-consumer models appear to be the administration’s preferred vehicle for delivering MFN pricing. The administration’s July 31 letter expanded the direct-to-consumer provision for “high-volume, high-rebate drugs” to include direct-to-business distribution. Two months later, the administration announced TrumpRx. In a November 6 fact sheet, the administration confirmed that TrumpRx will be the primary platform through which American patients can access MFN-level prices on select medicines – starting with substantial discounts on drugs from Eli Lilly and Novo Nordisk – and reiterated that the site is expected to go live in January 2026 as a portal to participating manufacturers’ direct-to-consumer sites. 

While popular across many sectors, direct-to-consumer pharmacy models remain a small, albeit growing, market in pharmacy. Some models, such as Mark Cuban Cost Plus Drugs, who True Rx collaborates with as in-network option for patients, have gained traction by offering transparent pricing directly to consumers, and can serve as valuable in-network options within employer-sponsored plans.  

Impact of DTC to patients

When models like Mark Cuban Cost Plus Drugs are included within a PBM’s network, patients can often access medications at lower prices, while still benefiting from insurance protections such as out-of-pocket maximums. However, at this time, it doesn’t appear that TrumpRx will be offered as part of a larger insurance network. 

Because of this, the value of TrumpRx for patients is mixed. Buying directly from manufacturers may offer lower prices for those without insurance, purchasing off-formulary medications, or facing a high deductible. However, for the vast majority of employees with employer-sponsored coverage, traditional benefit designs typically provide better out-of-pocket costs, especially when medications count toward deductibles and out-of-pocket maximums. 

Impact of DTC to employers

Because TrumpRx has not yet launched, it remains uncertain whether employees will opt to obtain medications, like GLP-1s, through TrumpRx instead of their employer-sponsored plans. Should this shift occur, employers may see fewer of these prescriptions processed through their benefit plans, which could result in lower rebate returns.

Importantly for employers, the early TrumpRx offerings include deep cash pay discounts on GLP-1 medications used for diabetes and weight management, a class of drugs that has been a major driver of pharmacy trend and plan sponsor concern over the past several years. While direct-to-consumer models may offer opportunities for drug cost savings and an access channel, employers should also consider the importance of coordinated clinical management to support overall patient outcomes and long-term cost control before choosing to exclude these medications from their benefit plan. 

What’s next?

It is far from clear how the majority of drug makers will respond to the executive order. Lawsuits derailed President Trump’s attempt at establishing a MFN policy during his first term. However, PhRMA (Pharmaceutical Research and Manufacturers of America), appears to be taking a different approach. A few manufacturers have announced one-off deals to provide select drugs at MFN pricing to Medicaid and, for select products, to patients purchasing through the TrumpRx direct-to-consumer channel. GLP-1s are expected to remain a key focus of these early arrangements given their high per-claim cost and rapidly growing utilization.

This leaves employers navigating significant uncertainty heading into 2026..

What can you do?

• Pause and assess. Work with your PBM to understand how MFN policies may affect your coverage. A strong health strategist will help you evaluate your current plan, anticipate potential impacts, and develop flexible solutions as more information becomes available. For GLP-1s in particular, this includes assessing current utilization
• Watch for PBM contract changes. Among drug pricing reform, pharmaceutical manufacturers, facing more pressure, may raise pricing internationally or look for new ways to avoid tariffs, like increasing U.S.-based manufacturing. As a result, PBMs may work to invoke “market conditions” to change contracts and pricing. Employers should stay informed and partner closely with their PBM to ensure any updates are transparent and free from hidden fees or reduced rebates.
• Ask questions: How is your PBM tracking MFN implementation? Are they proactively analyzing the implications and sharing updates? How are they monitoring TrumpRx activity and GLP-1 discount programs—and helping you understand when these options may or may not be appropriate for your members?
• Look for proactive affordability strategies: While MFN’s future remains uncertain, the need for cost management does not. Consider whether your PBM is offering innovative solutions like specialty infusion programs, GLP-1 clinical management strategies, or integrated discount programs that deliver savings at the pharmacy counter. The best partners don’t wait for policy changes, they’re already driving affordability through continuous innovation.
• Stay patient-centered: How does your coverage interact with DTC models? Are digital tools available to help employees make informed choices? Are live support channels in place for those who need guidance? Personalized service and clinical experience matter more than ever as the pharmacy landscape grows more complex. 

The MFN order is just one of many challenges facing a fragmented system. Your PBM should be proactively driving innovation, adapting to legislative shifts, and continuously finding ways to add value while making health care more affordable and accessible for your employees. 

As Health Strategists, True Rx partners with our clients to evaluate their current benefits, anticipate changes, and continuously refine their strategies as new insights and innovations emerge. Through the True Experience, we bring forward-thinking solutions and a commitment to health innovation that drive better outcomes and simpler experiences for those we serve.