Medicines: Italia remains among the countries most affected by the US crackdown on prices

The mid-term elections have dealt a blow to Trump’s Republicans and handed the Democrats a majority in both the House of Representatives and the Senate, and thus control of Congress. But on drug prices, which are a burden on Europe, the picture remains unchanged: according to analysts, the Most Favoured Nation (MFN) agreements signed by the administration with the companies will remain in force. The new Congress will primarily hold hearings and call for transparency regarding agreements that have largely remained confidential. The issue, moreover, enjoys bipartisan support: the White House says it is working with Congress to codify the agreements. This interpretation is confirmed by the 21st Meridiano Sanità Report, in the chapter on Life Sciences and the geopolitics of health prepared by the Teha Group prior to the election and presented today in Rome. The MFN, the authors write, is not a measure linked to the Trump presidency, but a new competitive paradigm set to endure, for three reasons: the pressures on US public finances are structural; the measure forms part of a broader strategy of industrial autonomy; and once investments have been relocated, they are unlikely to return.

With the executive order of 12 May 2025, Washington aims to pay no more for certain medicines than is the case in a basket of developed countries, including Italia. Tariffs are being used as leverage: agreements with 17 major companies – a figure that rose to 26 in August – link MFN prices and tariff exemptions to investment in the United States (US$448 billion by 2029 for the first 17). The report warns that the signs are preliminary but not reassuring: in the ten months following the executive order, launches of new medicines in the European countries included in the basket fell by 35 per cent, and by 67 per cent in Italia.

The Italian paradox is that the country’s productive capacity makes it vulnerable. Italia is the EU’s second-largest pharmaceutical producer, with production worth €74 billion in 2025 and exports worth €69.2 billion – up 27.8 per cent on 2024 – but in TEHA’s matrix of 14 benchmark countries, it is, alongside Ireland, the only one at high risk in terms of both manufacturing investment and research and innovation. Key factors include energy costs, labour costs and time-to-market: it takes 14.7 months from approval to the availability of a medicine, rising to 27.7 months when regional approvals are factored in, compared with 4 months in the United States. Clinical research is also at stake, representing a market worth around €2.6 billion in the country.

The Mfn forms part of a wider shift in the balance of power. Between 2010 and 2025, the United States, including Canada, saw its share of the global market rise from 42.3 per cent to 54.7 per cent, whilst Europe’s share fell from 29.2 per cent to 23.7 per cent. China, which has remained at 6.5 per cent of the market, has increased its share of new clinical trials from 10.1 per cent to 45.8 per cent of the total across the three regions and launched 30 per cent of new chemical and biological entities in 2021–2025, more than Europe (19.6 per cent), with investment in research and development rising from 1.4 to 14.7 billion euros between 2010 and 2024. Europe remains in the lead for scientific publications, but struggles to translate these into industrial applications: authorising a clinical trial takes 106 days, compared with 70 in China and 30 in the United States.

The impact of the election on US research is less certain. Since the start of its term, the administration has scrapped thousands of funding programmes and sought unprecedented political control over agencies such as the National Institutes of Health. The Democrats will chair the committees that fund and oversee these agencies, but the budgets require Trump’s signature. Indeed, even with a Republican-majority Congress, both Houses had previously rejected a proposal to cut NIH funding by more than 40 per cent. For Europe, the competitive landscape outlined in the report remains unchanged.