The truth about PBM reform and pharma’s path forward.

From predictions of mostly status quo to major shake-ups, the crystal ball gazes for impacts on the biopharmaceutical industry during a second Trump administration vary widely. However, the one thing that does seem certain is uncertainty. 

Many of the president’s choices to lead health agencies and pharma policymaking in his second term haven’t followed typical career paths of federal government service or even industry expert experience. It’s led to many questions and the certain uncertainty about what lies ahead for the next four years.

Still, it’s important to consider what could happen—and experts do generally agree on some key biopharma and health care effects—because preparing for the unexpected is fundamental to brand strategy.  

For pharma and health care marketers, preparing means consulting with experts—Legal, Strategic, and Policy Teams, for instance—but also taking a wait-and-see approach and avoiding buying into media hype or administration rhetoric.

Drug pricing discussions will continue

One of the pharma industry's perennial topics is prescription drug pricing, and that will continue under the Trump administration. So far, early conversations are focused on the Biden Administration’s Inflation Reduction Act and its drug pricing and negotiating provisions. 

While the law passed in 2022 is unlikely to be repealed—parts of the IRA benefit Republican-held areas of the country, making it difficult for even a majority Republican Senate and House to overturn—it could be significantly changed. Presidential executive orders and Congressionally targeted budget cuts or partial repeals could noticeably alter or slow down implementation of the massive law that includes tax policies, investments in clean energy and infrastructure, and health care cost savings. 

While the climate and tax policy parts of the IRA face almost definite modifications, some health care provisions are expected to remain. For example, the $2,000 cap on out-of-pocket prescription drug expenses for Medicare recipients that went into effect on January 1 is broadly popular across many stakeholders. Another well-regarded provision is the capping of insulin costs at $35 for Medicare patients. The popularity of both measures and bipartisan agreement in general about the government’s responsibility to cut drug prices have most experts anticipating those will remain.

Biopharma companies, however, have reportedly set their sights on a different IRA measure—Medicare drug price negotiations. The industry began lobbying the Trump administration for a revamp of the negotiations months before he took office, according to Reuters. 

A handful of lobbyists and executives who work with pharma and biotech companies “are pushing to delay the timeline under which medications become eligible for price negotiations by four years for small molecule drugs,” the publication reported in late November. As the law currently stands, complex drugs with no competition won’t face price negotiations for 13 years, but small molecule pills and capsules are only allowed 9 years.

The first 10 drugs with negotiated prices were announced in August and will take effect on Jan. 1, 2026. The Centers for Medicare & Medicaid Services (CMS) is supposed to announce the next list of 15 drugs selected for negotiation by Feb. 1.

During Trump’s first term, he tried to tackle drug prices by signing an executive order to advance a “most favored nation” plan to tie reimbursement of some drugs to lower drug prices in other countries. The 2020 mid-summer order was blocked in court after several health associations sued, and Trump subsequently lost the election in November 2020. 

In October 2024, Trump spokespeople told the media he would not pursue the most favored nation policy again, but more recently, Eli Lilly CEO David Ricks indicated international drug pricing is up for discussion in the Trump administration. 

He told Bloomberg at an Economic Club event in December, “In foreign countries, it is true our prices are lower in those places. We would like to correct that … We have to raise developed countries what they pay, and we can lower the U.S. I think that’s a policy argument we’ll hear about soon with the new administration.”

The Bloomberg interview happened a week after Ricks, Pfizer CEO Albert Bourla, and Steve Ubl, head of leading industry trade group PhRMA, met with Trump at his Florida Mar-a-Lago club.

Trump’s own words: While Trump has publicly pledged to rescind unspent funds specifically for climate provisions in the IRA, prescription drug pricing is “conspicuously absent” from his IRA repeal promises, Forbes reported.

PBMs in the line of fire

Pharmacy benefit managers (PBMs), the so-called middlemen who manage and administer drug benefits for commercial and government health insurers, including negotiating rebates with drugmakers, face a tough road in the new administration and Republican Congress.

Near the end of Trump’s first term, he tried to enact PBM reforms with a “rebate rule” that would have forced PBMs and insurers to pass along discounts from drugmakers directly to patients. 

Former FTC Policy Director David Balto wrote in a STAT column recently that Trump will probably pick up where he left off, adding, “Trump 2.0 is likely to be giving the PBMs some doses of regulatory medicine they certainly don’t want.”

While the 2024 end-of-year federal funding continuing resolution ultimately passed with the removal of PBM reforms, it had bipartisan agreement. Republicans have been the drivers of forcing PBM changes, but Democrats, including Sen. Elizabeth Warren (D-MA), also want reform. She co-sponsored the PBM Act with Sen. Josh Hawley (R-MO) and others in 2024 in an effort to end joint ownership of PBMs and pharmacies and prohibit insurers from owning pharmacies. 

Trump’s own words: In late December, Trump referred to PBMs as “The horrible middleman that makes more money, frankly, than the drug companies, and they don’t do anything except they’re a middleman,” adding “We’re going to knock out the middleman.”  A day later Pfizer CEO Bourla affirmed in an investor call that the president is committed to PBM reform and “wants transparency.”

Pharmaceutical drug ads on the chopping block?

Another major uncertainty for biopharma marketers in the second Trump administration is the threat to pharma advertising. 

Health and Human Services’ nominee Robert F. Kennedy Jr. has publicly professed a goal to “ban pharmaceutical advertising,” and Trump’s trusted advisor Elon Musk, who is co-head of the new Department of Government Efficiency, also declared “no advertising for pharma” on X in November. 

Pharma TV ads are generally unpopular among consumers, physicians, and other stakeholders, but pharma ads—like all advertising—are covered by First Amendment protections of commercial speech. The second Trump administration wouldn’t be the first to try to get rid of the ads, though. The American Medical Association voted to ban all direct-to-consumer pharma ads in 2015, and while not a binding ruling, spoke to the general dislike of the ads among physicians.

Meanwhile, various Congress members, taking into account the First Amendment difficulties of an outright ban, have proposed restrictions on pharma ads, including many efforts to eliminate the industry’s advertising tax deductions. In 2017, lawmakers led by Democrats got close to advancing the tax reform to take away pharma write-offs for advertising expenses, although it didn’t get enough Republican support to pass.

More recently, this summer, Sen. Angus King (I-ME) and Rep. Rosa DeLauro (DCT) introduced legislation to prohibit pharma ads for new drugs for the first three years after FDA approval. 

Those types of challenges—added regulations or more strictly enforced rules around pharma advertising—are more likely than an outright ban due to the courts’ long-upheld precedent of the right to commercial free speech.

Trump’s own words: While Trump’s inner circle has criticized pharma advertising, Trump hasn’t commented much about it directly. He did promise to let RFK Jr. “go wild” on health care, and back up some of Kennedy’s anti-establishment vaccine views. Trump said he planned to confer with him on ending childhood vaccine programs, Reuters reported in December.

Adapting to the changing environment 

As the biopharma industry faces shifting policies and unpredictable challenges, your ability to adapt is crucial. Changes in drug pricing, PBM regulations, and advertising rules could impact your strategy and bottom line. Aquent’s specialized talent and strategic insight can help you anticipate, adapt, and thrive in this environment. Don’t let uncertainty hold you back—stay ahead with flexible, creative solutions tailored to your needs.

Let’s prepare for what’s next together.