The End of Single-Drug Economics: On the Eve of a Major Reshuffle of Global Innovative Drug Rules
Place these three documents side by side, and you will detect a shared underlying thread.
The first one was released in Washington. On August 31, 2026, the White House official website issued a statement that the government had signed "Most Favored Nation" (MFN) drug pricing agreements with 9 more pharmaceutical companies. The list includes Alcon, Astellas, Teva, Sun Pharmaceutical, and a company that caught everyone by surprise — BeiGene. This marks the first time a Chinese pharmaceutical enterprise has been included in the pricing framework led by the U.S. government. So far, the number of pharmaceutical companies that have signed agreements with the U.S. government has reached 26, covering approximately 89% of the U.S. brand-name drug market.
The second one was released in Beijing. On December 7, 2025, the National Healthcare Security Administration and the Ministry of Human Resources and Social Security issued Document No. 33 [2025] of the Healthcare Security Development, releasing two catalogs simultaneously for the first time in history: the National Catalog of Drugs for Basic Medical Insurance, Maternity Insurance and Work Injury Insurance, and the Catalog of Innovative Drugs for Commercial Health Insurance. The former added 114 new drugs, while the first edition of the latter included 19 drugs — 5 CAR-T cell therapies were all shortlisted, including two new drugs for Alzheimer's disease. One table has been officially split into two.
The third one was released in Boston. On September 11, 2026, the FDA approved Scholar Rock's Isembyld (apitegromab), an add-on therapy for spinal muscular atrophy (SMA). Three days later on September 14, the company announced the pricing at an investor conference call: $11,659 per vial, with an annual net cost of approximately $310,000 for a "typical patient". Doubts emerged even earlier than the approval: the Institute for Clinical and Economic Review (ICER) released an assessment report in July 2025, calculating the "health benefit price benchmark" of this drug at $4,600 to $30,200 per year. The approval was delivered after market close on September 11, with almost no movement in the stock price that day. On the Monday (September 14) when the pricing was announced, the stock closed down 6.4%. From a capital market milestone to a tricky arithmetic problem, there was only a weekend in between.
If you, like me, lay out the timelines of these three events on a piece of paper, you will find that they all point to the same direction: payers are evolving from price takers to price setters. And this shift is happening simultaneously across the globe this time.
| Over the past three decades, the global pharmaceutical industry has operated on an unspoken but universally accepted foundation: according to the repeated statements of Washington itself — the United States, with less than 5% of the global population, generates approximately 75% of the world's pharmaceutical profits — high drug prices subsidize global R&D; other countries use various forms of price control to ensure accessibility, at the cost of sending the innovation bill to the United States. Another name for this system is "the U.S. pays the bill".
From 2025 to 2026, the foundation of this system has been almost simultaneously shaken by three countries with three sets of tools. Below, I will first clarify the background of each of these three paths, and then explain what their combination means.
01 The Background of the Three Paths
Washington: Tariffs as the Gun, MFN as the Price
To understand the U.S. path, you need to remember a sequence of dates, which is comparable to a complete "military operation".
In April 2025, the U.S. Department of Commerce launched an investigation into the pharmaceutical industry under Section 232 of the Trade Expansion Act, bringing drug supply chain security under the "national security" category. This is a key legal step: Section 232 grants the president the power to impose tariffs without congressional approval. On April 15 of the same year, Trump signed Executive Order 14273, "Lowering Drug Prices by Putting Americans Back First", requiring administrative departments to come up with a drug pricing plan.
On May 12, 2025, Executive Order 14297 was implemented: "Prescription Drug Pricing for Most Favored Nations for American Patients". The content is so straightforward that it seems blunt: U.S. drug prices should be aligned with the lowest net prices in other developed countries. On May 20, the Department of Health and Human Services released technical standards: for brand-name drugs with no generic or biosimilar competition, the MFN target price is the lowest price in countries with a per capita GDP no less than 60% of that of the United States among the Organization for Economic Co-operation and Development (OECD) members. In other words: whatever the selling price is in Switzerland, Canada, Japan, and Australia, the United States should adopt that lowest number.
The Washington think tank CSIS (Center for Strategic and International Studies) later made the official logic very clear: the United States believes it is "subsidizing overseas socialism" — pharmaceutical companies accept low prices overseas, and then recoup all their profits from the U.S. market.
On July 31, 2025, Trump sent an open letter to 17 leading multinational pharmaceutical companies, ordering them to provide binding MFN commitments within 60 days, that is, before September 29. The pharmaceutical industry still remembers the atmosphere that summer: this was not an old-style executive order that could be dragged on until the next administration, but an ultimatum.
On September 26, 2025, the "gun" was shown. Trump announced that 100% tariffs would be imposed on patented drugs unless companies build factories in the United States. Four days later, on September 30, Pfizer became the first company to sign, exchanging price commitments for a three-year tariff exemption. The subsequent plot was like a domino effect: AstraZeneca on October 10, Eli Lilly and Novo Nordisk on November 6, and Amgen, Bristol Myers Squibb, Boehringer Ingelheim, Genentech, Gilead, GSK, Merck, Novartis, and Sanofi collectively signed at the White House on December 19. In January 2026, Johnson & Johnson and AbbVie followed suit. On April 23, 2026, Regeneron, the last of the 17 named companies, also signed.
On February 5, 2026, the TrumpRx platform was launched, through which pharmaceutical companies sell discounted drugs to consumers via this official direct sales channel.
On April 2, 2026, the tariff executive order was officially signed. This is the most institutionally damaging document in the entire process: a maximum 100% Section 232 tariff is imposed on imported patented drugs and active pharmaceutical ingredients, with only two exemption paths: either commit to building a factory in the United States (the new factory must be completed before January 2029, otherwise it will be treated as an unsigned company), or sign the MFN pricing agreement. For companies that have signed the agreement, the 0% tariff treatment will take effect on April 2, 2026, and last until January 20, 2029; for companies that have not signed, the 100% tariff will take full effect on September 29, 2026 — note that this date is only two weeks away from today.
On August 31, 2026, the second round was launched, with 9 mid-sized pharmaceutical companies signing the agreement, including BeiGene. The White House also announced that the 9 companies have committed to a total investment of at least $19.6 billion in U.S. manufacturing in the short term; and the MFN clause also applies to all innovative drugs these 9 companies will launch in the United States in the future.
In two years, the concept of "international reference pricing", which had failed in many previous attempts (Trump proposed it in his first term in 2020, which was entangled in lawsuits and revoked by Biden in 2021), has become a fait accompli covering nearly 90% of the U.S. brand-name drug market. In the 2025 MFN negotiations, the price reduction of GLP-1 glucose-lowering and weight-loss drugs exceeded 65%, and Chinese investors gave this mechanism a nickname: "U.S.-style volume-based procurement".
The White House's calculation in May 2026 stated that the MFN agreement would save Medicaid $64.3 billion over ten years, totaling $529 billion including the private insurance market. Critics such as Senator Wyden called it "a scam", and scholars from Health Affairs also pointed out that many agreement clauses are kept confidential, and the actual concessions may be far less than publicized. Both of these things can be true at the same time. But for the industry, the key has never been how much money is saved, but that the pricing anchor has changed: from now on, the linkage between U.S. drug prices and the lowest international price has become a precedent that the government can invoke at any time.
There is another easily overlooked detail that is precisely the most important one: the FDA launched the "Commissioner's National Priority Review Voucher" (CNPV) in June 2025, with a target review cycle of only 1 to 2 months. 8 of the 16 signed enterprises obtained CNPV in 2025. The government uses review speed as a bargaining chip in exchange for price concessions — regulatory power and pricing power have been tied to the same negotiation table for the first time.
Beijing: Splitting One Table into Two
The starting point of China's path is a well-known number that few people are willing to explicitly point out.
The hidden threshold that has been circulating in the medical insurance negotiation circle for many years is called "no negotiation for drugs over 500,000 yuan, no inclusion for drugs over 300,000 yuan" — drugs with an annual treatment cost exceeding 500,000 yuan are difficult to enter negotiations, and drugs exceeding 300,000 yuan are difficult to be included in the catalog. This threshold has never been explicitly stipulated, but it is like a contour line, blocking all high-value innovative drugs from the basic medical insurance covering 1.3 billion people. The price of a single CAR-T therapy is at the million-yuan level, and it has been repeatedly rejected for years of applications; the new Alzheimer's disease drugs lecanemab and donanemab are simply unaffordable for basic medical insurance.
The new pancreatic cancer drug daraxonrasib (developed by Revolution Medicines, for which BeiGene obtained exclusive rights for the Chinese and Southeast Asian markets on August 10), approved in August 2026, pushed this problem to the limit: the U.S. price is $39,800 per month, with an annual treatment cost of about $470,000, equivalent to more than 3.2 million yuan. But between a good drug and affordability, there is still a gap in the payment system.
On the other side of the pressure is the industrial demand. Over the past eight years, the National Healthcare Security Administration has adjusted the drug catalog every year, adding a total of 949 new drugs. The fund has spent more than 460 billion yuan on negotiated drugs within the agreement period, driving sales of more than 600 billion yuan — the "replacing the old with the new" policy has created the fastest growth rate of innovative drugs in the world, but the ceiling is also clearly visible: when the price of a drug exceeds the affordability of basic medical insurance, entering the catalog is "suicide" (the price will be cut drastically), and not entering the catalog is "waiting for death" (patients cannot afford it).
On June 30, 2025, Document No. 16 [2025] of the Healthcare Security Development, "Several Measures to Support the High-Quality Development of Innovative Drugs", was issued, and the idea was clearly stated for the first time: add an innovative drug catalog for commercial health insurance, focusing on including innovative drugs with "high innovation degree, great clinical value, significant patient benefit and beyond the coverage of basic medical insurance", and recommend the multi-level security systems such as commercial health insurance and medical mutual aid for reference.
The 2025 national negotiation adopted the "3+2" schedule for the first time: basic medical insurance negotiations were held for the first 3 days, and commercial insurance consultations were held for the last 2 days. 24 varieties participated in the commercial insurance consultation, and 19 of them reached agreements.
On December 7, 2025, the dual catalogs were officially released.
The basic medical insurance catalog added 114 drugs, of which 111 are new drugs launched within 5 years and 50 are Class 1 innovative drugs, both the number and proportion have refreshed historical records; the negotiation success rate of Class 1 new drugs is 88%, significantly higher than 76% in 2024. Drugs such as sacituzumab govitecan for triple-negative breast cancer and glecirasib targeting KRAS have achieved "inclusion in medical insurance immediately after approval". The total number of catalog drugs has increased to 3,253.
The first edition of the commercial insurance innovative drug catalog includes 19 drugs, covering 18 enterprises, roughly half of which are domestic and half imported; 9 are Class 1 new drugs; 5 marketed CAR-T therapies are all shortlisted; lecanemab and donanemab for Alzheimer's disease, as well as drugs for Gaucher's disease, neuroblastoma, multiple myeloma, and short bowel syndrome are also selected.
What really shocked the industry are the supporting provisions. For the drugs in the first edition of the commercial insurance catalog: they are not included in the self-pay rate assessment of medical institutions, not included in the volume-based procurement monitoring, and not included in the DRG/DIP disease payment assessment. Anyone who has experience in hospital access knows that these three exemptions solve the most painful "difficulty in entering hospitals" for innovative drugs — hospitals will not be assessed and deducted points for prescribing high-priced drugs, and doctors will not have to abandon the drugs to avoid losses under DRG bundled payment. The policy even requires all designated medical institutions to hold a pharmaceutical affairs meeting in principle by the end of February 2026, to include the newly added drugs in the in-hospital procurement catalog; for high-value innovative drug cases that are not suitable for bundled payment by disease, "special case review" is allowed.
The new version of the catalog has been implemented nationwide since January 1, 2026.
If you translate this document into business language, it means: basic medical insurance manages the basic market without loosening price discipline; for the part beyond the basic coverage, the state personally builds a commercial payment platform, and removes all the most expensive "chairs" in the venue. High-value drugs no longer need to squeeze through the narrow door of "no negotiation for drugs over 500,000 yuan", but they cannot expect to swim at the old price in the basic medical insurance pool — diversion, pricing, each in its proper place.
Boston: $310,000, One Weekend
The protagonist of the third path is the smallest, but the most symbolic.
Spinal muscular atrophy (SMA) affects about 1 in every 10,000 to 15,000 newborns, with about 10,000 diagnosed patients in the United States. This disease has had two generations of sky-high priced drugs in the past decade: Spinraza (nusinersen) was launched with an annual price of $375,000 after the first year, and Evrysdi (risdiplam) has a maximum annual price of $340,000. Both of them target the SMN2 gene pathway.
Scholar Rock's Isembyld takes a different path: it inhibits myostatin and acts directly on muscles — it is the first "add-on therapy", which means patients must use it on the basis of already using Spinraza or Evrysdi. In the Phase III SAPPHIRE trial (188 patients enrolled, 98% subsequently entered the extension study), among the main analysis population aged 2 to 12, the motor function score of the recommended 10 mg/kg group was 2.2 points higher on average than that of the placebo group (nominal p=0.012), while the function of the placebo group continued to decline; 34.2% of the treated patients achieved an improvement of more than 3 points, compared with only 13.5% in the control group. The trade-off is a new fracture warning on the label: 9% of patients in the recommended dose group had fractures, compared with 2% in the placebo group. The data is real, the mechanism is new, and the indication is unmet.
The drug was originally scheduled to receive a regulatory decision on September 22, 2025, but received a rejection letter the next day. Note that the problem was not the data, but the quality issue at the filling line of Catalent's factory in Indiana. After replacing the factory and resubmitting the application, the FDA approved Isembyld on September 11, 2026, 19 days ahead of the scheduled date of September 30.
Then came the pricing. At the conference call on September 14, the answer was revealed: $11,659 per vial (the list price according to Reuters; the wholesale acquisition cost (WAC) given