AbbVie and Trump administration reach agreement on drug prices, tariffs
Global life sciences leader AbbVie says it has entered into a voluntary agreement with the Trump administration to further advance access and affordability of medications for Americans in exchange for exemption from tariffs and future price mandates.
The North Chicago-based company aims to provide low prices in Medicaid while pledging $100 billion in U.S.-based research and development and capital investments, including manufacturing, over the next decade. AbbVie also will expand direct-to-patient offerings through TrumpRx for medicines used by millions of Americans, including Alphagan, Combigan, Humira And Synthroid.
“AbbVie’s mission is to make a remarkable impact for the patients we serve around the world through our innovative medicines,” said Robert A. Michael, AbbVie chairman and chief executive officer, in a news release. “With approximately 29,000 U.S.-based employees and products treating 16 million Americans annually, we understand the complexity and access challenges in our health care system. AbbVie is following President Trump’s call to action by reaching this agreement, allowing us to collectively move beyond policies that harm American innovation.”
In December, President Donald Trump announced that nine drugmakers had agreed to lower the cost of their prescription drugs in the U.S. Pharmaceutical companies Amgen, Bristol Myers Squibb, Boehringer Ingelheim, Genentech, Gilead Sciences, GSK, Merck, Novartis and Sanofi agreed to rein in Medicaid drug prices to match what they charged in other developed countries.
As part of the deal, new drugs made by those companies also will be charged at the so-called “most-favored-nation” pricing nationwide on any newly launched medications for all, including commercial and cash pay markets as well as Medicare and Medicaid.
Trump administration officials said the drugmakers also will sell pharmacy-ready medicines on the TrumpRx platform, set to launch this month, and will allow people to buy drugs directly from manufacturers.
AbbVie's agreement, which addresses all four of the Trump’s drug pricing priorities, was enabled by the administration providing exemption from tariffs and future price mandates. Further terms of this agreement remain confidential.
In August, AbbVie announced the company is investing $195 million to expand its North Chicago manufacturing facility. That investment is meant to strengthen AbbVie’s production of active pharmaceutical ingredients, and create and retain high-quality jobs in the region, according to Gov. JB Pritzker’s office.
AbbVie previously announced plans to invest more than $10 billion in U.S. capital projects over the next decade. Construction to expand the North Chicago facility began in the fall. It will grow AbbVie’s footprint in Illinois, where it is headquartered and employs more than 11,000 people.