Market Institute Joins Coalition Opposing Most-Favored-Nation Drug Pricing

The Market Institute joined dozens of free-market, taxpayer, and innovation-focused organizations in a February 12 coalition letter to Congress opposing efforts to codify a Most-Favored-Nation (MFN) prescription drug pricing model into law.

In the letter, the coalition warned that MFN would not solve the real problem of foreign price controls. Instead, it would import those controls into the United States, reduce access to new cures, and weaken America’s global leadership in medical innovation.

MFN Would Not Fix Foreign “Freeloading”

The coalition argued that tying U.S. drug prices to those set by foreign governments would effectively surrender to their price controls rather than force them to pay more for innovation. Many foreign systems do not truly negotiate prices; instead, they impose take-it-or-leave-it terms backed by legal threats such as compulsory licensing or competition penalties.

Reduced Access to New Medicines

The letter also warned that MFN-style price controls would reduce investment in research and development, leading to fewer new treatments and potential drug shortages. Developing a single drug can cost billions of dollars and take more than a decade, with most candidates failing before approval. Because of the U.S.’s more market-driven system, American patients currently have access to a much higher share of new medicines than patients in other developed countries.

Threat to U.S. Biotech Leadership

The coalition cautioned that adopting MFN would undercut America’s role as the world leader in biotechnology at a time when China is rapidly expanding its clinical trials, patents, and investment. Policies that weaken incentives for innovation would leave the United States a follower, not a leader, in medical breakthroughs.

A Better Path: Markets and Innovation

Rather than importing foreign price controls, the coalition urged Congress to pursue reforms that strengthen competition, protect intellectual property, and encourage innovation—policies that lower costs over time while expanding patient access to lifesaving treatments.

Market Institute President Charles Sauer signed the letter along with leaders from dozens of national organizations.

Read the full coalition letter here