US Secretary of Commerce Howard Lutnick described how pharmaceutical companies have charged Americans significantly higher prices than consumers in other countries while selling the same product overseas for far less. Speaking on the All-In Podcast, Lutnick outlined how tariff pressure was used during the Trump administration to force changes in pricing and supply chains.
“America is the client, is the consumer, is the payer worldwide,” Lutnick said. “These ( ) companies make 75% of their revenues in America, and it’s 100% of their profits.”
He contrasted US pricing with Europe, saying Americans often pay around $1,000 for GLP-1s that sell for roughly $175 overseas.
Lutnick explained that the disparity comes from how countries with socialized healthcare negotiate.
“Europe says, ‘Yeah, we have socialized medicine. We’re not buying it unless, what’s your cost?’ And the ( ) company says 100 bucks. So they say, we’ll pay you $175. You can make 75 bucks.”
When companies refuse those terms, governments simply walk away, forcing manufacturers to choose between lower margins or losing the market entirely.
According to Lutnick, President Donald Trump pushed for a Most Favored Nation pricing model to counter this system.
“Donald Trump says, I want to fix it, and I want MFN price. Most favored nations. So we’re the cheapest price in the world,” he said. “If you’re willing to sell it to them for 175 bucks, don’t come here and tell me that I have to pay a thousand. It’s just unfair.”
Lutnick said the Commerce Department coordinated with Health and Human Services and Robert F. Kennedy Jr., using tariffs as leverage.
“We want your best (product) at MFN prices. You can’t sell it to anybody in the world at a better price than you sell to us, of the countries that have money. Charge us the same and reshore, and I’ll waive your tariff while you’re reshoring, provided you do those two, or hammer.”
He claimed the approach led to sharp price reductions for widely used GLP-1s such as ozempic and Mounjaro, making them available through Medicaid and Medicare at $149.
“Instead of generally for sale for thousands, everyone in America can have it for 149 bucks,” Lutnick said.
He also stated that Merck agreed to provide its top selling products to Medicaid and Medicare at no cost.
Lutnick estimated total annual savings to Americans at between $25 billion and $35 billion.
He also raised national security concerns about pharmaceutical supply chains, noting that while many generics are manufactured in India, their active ingredients often come from China.
“If there’s one nut or bolt that you need and it comes from China, they don’t send it to you,” he warned.
Lutnick said similar dynamics apply to other industries, where Chinese state subsidies allow manufacturers to undercut US producers by selling finished goods at or near the cost of raw materials, forcing domestic companies out of the market.
Looking ahead to 2026, he said the administration planned to aggressively target healthcare fraud, which he estimated costs taxpayers around one trillion dollars annually.
“No one has ever looked at if you’re getting Medicaid and Medicare, how much money do you make. No one’s ever compared the two,” he said.
The pricing changes, according to Lutnick, were part of a broader strategy to rebalance trade and restore domestic manufacturing by tying market access to pricing discipline and reshoring commitments, rather than allowing American consumers to continue subsidizing pharmaceutical profits worldwide.
