Books & Magazines

Prelims Wallah (Q&A Bank)

Udaan

Udaan 500+

Budget & Economic Survey

Monthly Current Wallah

Weekly Current Wallah

Editorial Summary

Editorial Q&A Compilation

NCERT Wallah

Prahaar (Mains Wallah)

Marks Booster

Mains Wallah (Q&A Bank)

UPSC PYQs

UPSC Notes

CA & Editorials

Daily Current Affairs

Subject Wise Current Affairs

Editorial Analysis

Other Resources

Current Affairs

Trump’s Most Favoured Nation (MFN) Policy on

Trump’s Most Favoured Nation (MFN) Policy on Drug Pricing

PWOnlyIAS

May 13, 2025

Trump’s Most Favoured Nation (MFN) Policy on Drug Pricing

On May 12, 2025, US President Donald Trump signed an executive order invoking a “Most Favoured Nation” (MFN) pricing policy aimed at drastically reducing drug prices in the US.

Key Highlights of Executive Order

  • Price Benchmarking: US drug prices will be aligned with the lowest prices paid internationally among developed nations.
  • Anti-Profiteering: The policy is framed as a strike against “middlemen” and pharmaceutical profiteering.
  • Voluntary Compliance: Companies are being encouraged to voluntarily reduce prices, although legal enforcement mechanisms remain unclear.
  • Electoral Messaging: Framed as restoring “fairness to American consumers” and part of broader healthcare reform.

About MFN

  • MFN Clause (Article 1, GATT 1994):  Under WTO rules, member nations cannot discriminate between their trading partners. If one country is given a special trading benefit (like reduced tariffs), the same must be extended to all other WTO members.
  • India’s Example: India granted MFN status to Pakistan from 1996 to 2019, but revoked it after the Pulwama terror attack, showing how MFN can be politically retracted.

Implications for India

Aspect Details
Pharma Exports India exports ~$9 billion worth of generic drugs to the US annually. Price benchmarking could squeeze margins, affecting India’s pharma trade surplus.
Global Pricing Pressure Indian firms may be pressured to lower international prices or risk being excluded from US procurement, affecting global competitiveness.
Domestic Price Hikes To offset US losses, companies may raise prices in domestic markets, affecting drug affordability in India.
R&D Investment Impact Lower profitability may curtail funding for research, innovation, and new drug development, weakening the long-term capabilities of Indian pharma firms.

Also Read
UPSC Daily Editorials UPSC Daily Current Affairs
Daily Current Affairs Quiz Daily Main Answer Writing
Check Out Previous Years Papers From PW Store UPSC Test Series
Check Out UPSC NCERT Textbooks From PW Store Check Out UPSC Modules From PW Store 

Print Friendly, PDF & EmailDOWNLOAD PDF

To get PDF version, Please click on "Print PDF" button.

Print Friendly, PDF & EmailDOWNLOAD PDF

Recent Editorial

In India, Education without Employment

Ecology is the World’s Permanent Economy

Trade War

Why Farmers Prefer Growing Rice & Wheat

When Water Standards Don’t Hold Water

India’s Rising E-waste, The Need To Recast Its M...

Popular current affairs

Education Without Employment in India

52nd Chief Justice of India (CJI)

Clientelism, Patronage, and Freebies

Antibiotic Contamination of River

Tsarap Chu Conservation Reserve

India’s First 3nm Chip Design Centres

Our Courses

Our Courses

Need help preparing for UPSC or State PSCs?

Connect with our experts to get free counselling & start preparing

Aiming for UPSC?

Download Our App

# #

Download Our App

# #

Contact Details

Copyright © 2025 PWOnlyIAS
Privacy Policy Terms & Condition

To Download Toppers Copies: Click here

Aiming for UPSC?

Download Our App

# #
      

Follow Us:

Contact Details

Download Our App

# #
Copyright © 2025 PWOnlyIAS
Privacy Policy Terms & Condition
Quick Revise Now !
AVAILABLE FOR DOWNLOAD SOON
UDAAN PRELIMS WALLAH
Comprehensive coverage with a concise format
Integration of PYQ within the booklet
Designed as per recent trends of Prelims questions
हिंदी में भी उपलब्ध
Quick Revise Now !
UDAAN PRELIMS WALLAH
Comprehensive coverage with a concise format
Integration of PYQ within the booklet
Designed as per recent trends of Prelims questions
हिंदी में भी उपलब्ध

<div class="new-fform">






    </div>

    Subscribe our Newsletter
    Sign up now for our exclusive newsletter and be the first to know about our latest Initiatives, Quality Content, and much more.
    *Promise! We won't spam you.
    Yes! I want to Subscribe.