European Drugmakers Warn Continent of MFN Fallout

In the thick of Q1 2026 earnings season, drugmakers are becoming increasingly vocal in warning of the likely effects of U.S. most-favored nation pricing on European governments.

Novartis CEO Vas Narisimhan, in an interview with CNBC, said MFN presents a “very difficult situation” with significant long-term implications for European nations and “difficult trade-offs” for drugmakers. The Swiss manufacturer is particularly “disappointed” in proposed policy changes in Germany that could increase rebates on branded medicines.

British drugmaker AstraZeneca used its earnings call to preview a “very conservative” approach to MFN modeling: removing eight reference markets from future product forecasts. CEO Pascal Soriot stressed that “we are working very hard, not only we, but the whole industry” to leverage MFN to improve pricing and access environments in Europe and beyond.

AZ did applaud steps taken by the United Kingdom to increase reimbursement for medicines, citing the changes as a reason to restart investment in Britain totaling £300 million ($405 million). The company is also planning to resubmit the oncology drug Enhertu after it was rejected by the UK’s drug pricing watchdog, which Prime Minister Kier Starmer called a “major vote of confidence.”

Germany’s Boehringer Ingelheim, the largest private drugmaker, concurred with its public counterparts in calling for increased spending on medicines. Board Chair Shashank Deshpande shared criticism of Europe’s pricing ecosystem and its impact on innovation, warning that the region could become dependent on Asian suppliers “at a time when we’re super-dependent on China and India for generics.”

Concerns about drug access even reach beyond Europe. Japan, among the nations pegged as reference countries under MFN, typically sees lower prices for medicines at launch than all other major countries, according to PhRMA. Nikkei Asia points out that drugmakers may weigh “delaying or forgoing product launches in the Japanese market” to avoid the inclusion of the initial price in U.S. MFN calculations.

– Andrew Wishon, Editor-in-Chief

Kennedy Completes Marathon of Budget Hearings: The Defining Quotes

In April, HHS Secretary Robert F. Kennedy Jr. navigated a gauntlet of seven distinct Congressional hearings to answer members’ questions regarding the president’s FY27 budget proposal. A surprisingly (mostly) subdued Kennedy covered a wide range of health-related topics during his testimony, including reforms to both NIH and FDA, rural health, 340B, chronic disease and MFN deals.

However, Kennedy’s recent attempts to overhaul U.S. vaccine policy took a central focus across both the House and Senate sessions. As the Trump administration reportedly moderates its unpopular anti-vaccine positioning ahead of the midterm elections, Kennedy displayed a noticeable shift in his posture around the safety and efficacy of vaccines, at one point calling the MMR vaccine “essential to safeguard children’s health” and “97% effective.”

Below is our round-up of the top five notable quotes on priority topics from across the hearings:

Vaccine Safety and Public Trust

“I’ve never been anti-vaccine. What I’ve said is vaccines should be adequately safety-tested so we know both the risks and the benefits. Our job is restoring gold-standard science and integrity across the agency.”

Chronic Disease and Systemic Failure

“We stand at a generational turning point – our children are the sickest generation in modern history, and decades of failed policies, captured agencies and profit-driven systems have caused it. Parents across the country demanded change, and we are delivering it.”

Prescription Drug Pricing

“We negotiated Most Favored Nation drug prices with 16 of the largest pharmaceutical companies so Americans no longer pay more than people in other wealthy countries for the same medications. We’re bringing real transparency to healthcare pricing.”

NIH Funding and Research Prioritization

“Nobody wants to cut NIH funding. I don’t want to cut it. The president doesn’t want to cut it. But when you have a $39 trillion debt, that is itself a social determinant of health. What we are doing is recalibrating NIH spending – moving dollars away from waste and toward chronic disease, which NIH has largely never studied before.”

FDA Oversight and Reform

“We are going to exercise real FDA oversight. Products are going to have to get through a lot more skepticism, and manufacturers are going to have to show us – not tell us – that they are safe.”

– Rachel Bridges, Senior Director

Circled on Our Calendar

• May 5 – field hearing on “Making Health Care Affordable Again,” Senate HELP Committee

Quotes of the Week

• “By coupling these design principles with real-time data streaming, we can bring unbroken drug development to all disease areas. Whether we are fighting rare genetic disorders, autoimmune diseases or widespread chronic conditions, continuous trials will ensure that data informs decisions instantly.” – FDA Commissioner Marty Makary, STAT
• “Biopharma CEOs believe that lobbying the FDA commissioner, directly or through intermediaries, is an effective way to enhance the chances that their therapies will be approved. This would have been absurd under previous commissioners, but now FDA staff say it is a reasonable strategy.” – Steve Usdin, BioCentury
• “Although 340B does not operate through the tax code, its economic effects mirror those of a tax expenditure. Recognizing it as such would not prejudge the program’s merits, but it would force a long-overdue accounting of its costs and encourage a more rational discussion of reform.” – Ike Brannon & Anthony T. Lo Sasso, Health Affairs Forefront

Other News

• Katherine Szarama was named acting director of the FDA’s Center for Biologics Evaluation and Research, following Vinay Prasad’s departure from the agency. STAT: Katherine Szarama named acting director of FDA’s vaccines and biologics center.
• CMS extended its deadline for drugmakers and states to join GENEROUS, a Medicaid payment model that aims to negotiate lower prices on prescription medicines. Reuters: CMS extends application deadlines for Medicaid drug pricing model.
• The FDA granted national priority vouchers to accelerate the review of three psychedelic-based treatments addressing treatment-resistant depression, major depressive disorder and PTSD, respectively. CNN: FDA moves to fast-track review of psilocybin and methylone for mental health.
• President Trump tapped Dr. Nicole Saphier, a radiologist and director of breast imaging at Memorial Sloan Kettering Cancer Center-Monmouth, as his third nominee to be surgeon general in the past year. The Hill: Who is Nicole Saphier, new Trump surgeon general nominee?
• Humana’s CenterWell Pharmacy and Mark Cuban Cost Plus Drugs announced a partnership to create employer solutions focused on technology and distribution. Fierce Healthcare: Humana’s CenterWell, Mark Cuban Cost Plus Drugs partner to tackle employers’ drug costs.
• The Trump administration appealed a federal judge’s ruling that overruled Secretary Kennedy’s push to overhaul U.S. vaccine policy, including reducing the number of recommended child vaccinations. Reuters: Trump administration appeals judge’s order upending Kennedy’s vaccine policies.
• A bill introduced in Germany could see innovative medicines such as PD-L1 inhibitors be subject to pricing controls akin to those faced by generic medicines. Pink Sheet: German Bill Could Extend Generic Drug Price Controls To PD-L1 Inhibitors And Others.
• PwC informed U.S. staff it will not cover the cost of GLP-1 medicines for employees who do not have diabetes, as employers grapple with high demand for the medicines. Financial Times: PwC will drop cover for weight-loss drugs from employee health plans.

See you next week …
–  Real Chemistry

 

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