On December 19, 2025, Novartis announced a voluntary agreement with the US government aimed at reducing prices of innovative medicines in the US, aligning them more closely with those in other high-income countries (most-favored-nation approach). In exchange, the company secures continued support for massive US manufacturing and R&D investments, including a $23 billion five-year plan. The deal includes direct-to-patient access platforms and Medicaid enhancements for select drugs.
Glimpse:
The agreement supports the Trump administration’s push for most-favored-nation (MFN) pricing, where US prices match the lowest in comparable nations. Novartis will launch future medicines at comparable international prices, establish direct-to-patient platforms via TrumpRx for drugs like Tabrecta, Mayzent, and Rydapt, and apply to the GENEROUS Model for better Medicaid access. This comes amid nine similar deals with major pharma firms, balancing affordability for patients with incentives for US-based innovation and production.
Novartis has reached a significant voluntary agreement with the US government to lower prices of its innovative medicines while reinforcing its long-term commitment to US-based research, development, and manufacturing. Announced on December 19, 2025, the deal is part of a broader wave of agreements with nine major pharmaceutical companies including Amgen, Bristol Myers Squibb, Boehringer Ingelheim, Genentech, Gilead Sciences, GSK, Merck, and Sanofi under President Donald J. Trump’s most-favored-nation (MFN) pricing initiative.
The core aim is to bring US drug prices in line with the lowest prices paid in other developed nations, addressing long-standing criticisms that American patients subsidize global innovation. Novartis has agreed to several key actions:
Launch future medicines at prices comparable to those in other high-income countries.
Establish direct-to-patient platforms accessible via the upcoming TrumpRx platform for three specific drugs: Tabrecta (capmatinib) for lung cancer, Mayzent (siponimod) for multiple sclerosis, and Rydapt (midostaurin) for certain leukemias.
Apply to participate in the GENEROUS (GENErating cost Reductions fOr U.S. Medicaid) Model to improve medicine access and affordability for Medicaid patients.
This voluntary pact aligns with the administration’s broader strategy, including Executive Orders and tariff relief incentives, to encourage onshoring and protect innovation. Novartis is investing heavily in the US: a $23 billion plan over five years for expanded research and manufacturing, including a $1.1 billion biomedical research center in San Diego, a flagship hub with three facilities in Raleigh/Durham, North Carolina, and new radioligand therapy plants in Carlsbad (California), Texas, and Florida. These investments are expected to qualify for tariff relief and create thousands of jobs.
The agreement reflects Novartis’ strategy to balance accessibility with sustained R&D in markets that value innovation. It follows similar deals with other companies and builds on ongoing efforts to address global pricing disparities.
“This agreement continues our long-term partnership with the US government to advance the development and manufacturing of breakthrough treatments for patients in the United States.”
By
HB Team
