On October 10, 2025, President Donald Trump took to the Oval Office to announce what he described as a breakthrough deal with the British pharmaceutical giant AstraZeneca, aiming to make prescription drugs more affordable for Americans. This agreement, which closely follows a similar pact struck with Pfizer just a week prior, is being touted by the Trump administration as a bold step toward tackling the high cost of medicines in the United States. Yet, as with so many sweeping policy announcements, the details—and their potential impact—are more nuanced than the headlines might suggest.
At the heart of the arrangement is a so-called "most-favored nation" pricing model. Under this framework, AstraZeneca has committed to selling its drugs to Medicaid—the government insurance program for low-income Americans—at prices no higher than those offered to wealthy European countries. According to Axios, this means that for newly launched drugs and Medicaid purchases, the U.S. government will pay the lowest price AstraZeneca charges in any other developed nation. "Nobody ever thought they were gonna see [these prices]... and don't let Democrats take the credit," Trump declared during the Oval Office press conference, standing alongside AstraZeneca CEO Pascal Soriot.
But what does this mean for everyday Americans? The deal, as outlined by The New York Times, does not directly lower the prices of prescription drugs for the majority of Americans who are covered by Medicare or private health insurance. In fact, experts point out that Medicaid already benefits from some of the lowest drug prices in the U.S., thanks to federal laws capping out-of-pocket costs and mandating steep discounts from pharmaceutical companies. For many Medicaid recipients, the price per prescription is already capped at $8, and in some states, there’s no out-of-pocket cost at all.
Nevertheless, the Trump administration is promoting the agreement as a win for American consumers and a harbinger of more to come. In addition to the Medicaid pricing, AstraZeneca will offer discounted drugs through a new government-run website, TrumpRx.gov. This platform, which is expected to become fully operational next year, will allow consumers to purchase certain medications directly—bypassing insurance altogether. At the press event, officials demonstrated a promotional version of the site, which will serve as a landing page to direct patients to drugmakers’ direct-sales portals. AstraZeneca has already set up such a website, where patients can buy drugs like Farxiga (for diabetes and heart failure), Airsupra (an asthma inhaler), and FluMist (a nasal flu vaccine).
However, for most insured Americans, the out-of-pocket cost for these drugs through their insurance plans is likely to remain lower than the direct-purchase price on TrumpRx.gov. For example, while Farxiga might cost $182 per month on AstraZeneca’s website, a patient using insurance could pay as little as $25 as a co-pay. The voluntary nature of these deals, as Dr. Mehmet Oz, administrator of the Centers for Medicare and Medicaid Services, noted at a recent Aspen Institute event, is a sharp contrast to the regulatory approaches of previous administrations. "All these are opportunities for us to re-envision the way the government normally works, not based on litigation, slowing everything down, but by leapfrogging litigation, if possible, to get people to do what they probably want to do," Oz said.
There’s another carrot in the deal for AstraZeneca: a three-year exemption from tariffs on its products produced overseas. The Trump administration had threatened tariffs as high as 15% on brand-name drugs imported from the European Union and up to 100% from other countries. While those deadlines were delayed, the threat was enough to bring drugmakers to the negotiating table. Trump himself acknowledged the leverage, stating, "The tariffs were a big reason he came here," referring to CEO Pascal Soriot. Soriot, for his part, admitted that the negotiations had been intense, remarking, "You really kept me up at night."
The agreement is also part of a broader push by the Trump administration to encourage pharmaceutical companies to invest in American manufacturing. Just a day before the Oval Office announcement, AstraZeneca revealed a $4.5 billion investment in a new manufacturing plant near Charlottesville, Virginia. This facility is part of a larger $50 billion commitment to U.S. manufacturing and research and development over the next five years. According to The Guardian, this was one of the administration’s key demands: that drug companies expand their American footprint in exchange for relief from potentially devastating tariffs.
Despite the fanfare, skepticism remains about the real-world impact of these deals. As CNN’s Daniel Dale pointed out, Trump’s claim that the deal could cut drug prices by up to 1,000% is mathematically impossible. As health economist Timothy McBride explained, "Cutting drug prices by more than 100% would mean that Americans would get paid to acquire their medications rather than paying for them." Even more conservative estimates suggest that the savings for Medicaid could be modest at best, since the program already enjoys deep discounts. Craig Garthwaite, a professor at Northwestern University’s Kellogg School of Management, observed, "If you look at AstraZeneca’s portfolio, I don’t think there are a bunch of drugs that exist where that’s going to involve them giving a very big discount to Medicaid."
Furthermore, the deals struck with AstraZeneca and Pfizer cover only a small share of the companies’ U.S. sales, and do not touch the much larger Medicare market or private insurance plans, which account for the bulk of prescription drug spending. Brand-name drug prices in the U.S. remain, on average, three times higher than those in peer nations, a disparity that these voluntary deals are unlikely to erase. Rena Conti, an associate professor at Boston University, summed up the prevailing sentiment among health policy experts: "It’s good for the companies, and has very uncertain if any benefit for Americans struggling with the affordability of prescription drugs."
Politically, the announcement comes at a time of fierce debate over health care policy. Democrats have used the issue of rising health care costs to criticize the Trump administration, while Trump and Republicans argue that their approach will bring relief to consumers. Meanwhile, the Biden administration’s earlier legislation allowing Medicare to negotiate prices for a small number of drugs is set to deliver its first round of discounts next year, despite legal challenges from the industry.
Looking ahead, administration officials expect more drug companies to announce similar deals in the coming weeks. Notices on government websites have hinted that more aggressive regulatory approaches—such as rules linking U.S. drug prices to those overseas—could still be on the table. As the TrumpRx website prepares for its full launch and AstraZeneca moves forward with its U.S. expansion, Americans watching the headlines may be left wondering: will these deals finally bring real relief at the pharmacy counter?
For now, the AstraZeneca agreement stands as a symbol of the ongoing tug-of-war between the pharmaceutical industry, government regulators, and the millions of Americans who depend on affordable medicines. The coming months will reveal whether these voluntary price deals are a true breakthrough or just another round in a long-running battle over drug costs in the United States.
