The Trump Administration Is Going After German Pharmaceutical Pricing. Will France Be Subsequent?

Kiyan Slove-Rezvani is an IELP weblog intern

Americans pay way more for brand-name medicine than Europeans do. For years that was handled as a home well being downside. The Trump administration has began treating it as a commerce downside, and in June 2026 it opened a Section 301 investigation into Germany’s drug pricing.

This put up asks whether or not a German-style 301 investigation would work in opposition to France (one other European nation typically cited as an issue by U.S. authorities officers and pharmaceutical firms). It proceeds in three elements. First, it explains the Section 301 investigation in opposition to Germany, particularly, what USTR is alleging and why. Second, it explains how France units drug costs, since comparable motion in opposition to France must tackle the system in place there. Third, it seems on the debate inside France over how to answer American stress, which seems to be much less united than it first seems.

The German Section 301 case will get issues rolling

Section 301 of the Trade Act of 1974 supplies a set of procedures below which USTR can examine a international nation’s commerce practices. Among different issues, actionable conduct below Section 301 consists of acts, insurance policies, and practices of a international nation which are “unreasonable or discriminatory” and “burden or prohibit U.S. commerce.” If USTR finds that such conduct exists, the U.S. authorities can take motion, normally with tariffs.

The key evidence behind USTR’s investigation within the German pharmaceutical case is that U.S. shoppers pay roughly 3.9 occasions what German shoppers pay for brand-name medicine. USTR traces that hole to 2 particular German practices. The first is a rule that ties value confidentiality to a reduction, which means a producer can hold its negotiated value secret solely by accepting a reduction. The second is a draft legislation that will add a compulsory rebate on patented medicines, which the trade expects to develop over time. USTR’s initiation discover means that these practices – one in impact now, and the opposite probably coming into pressure quickly – collectively push German costs beneath truthful market worth and go away Americans to fund the distinction (by increased costs in America).

The investigation in opposition to Germany grew out of the May 2025 “Most-Favored-Nation” executive order, which set out to make sure that U.S. shoppers ought to pay no extra for a drug than the bottom value paid by any comparable developed nation. The Trump administration is making an attempt to realize this objective by elevating international costs by commerce stress (there have additionally been strikes by the administration to decrease U.S. costs, though it stays to be seen how profitable they are going to be). The United Kingdom already agreed to pay extra for brand spanking new U.S. medicines in alternate for tariff aid. USTR urged Germany to follow suit, however after months of talks, Germany as a substitute superior laws to additional reduce spending on progressive medicine, and the investigation adopted.

Will France be subsequent?     

Beyond Germany, France is one other EU nation that has typically been cited as a selected downside in relation to its drug pricing. In France, a single nationwide insurer, the Sécurité sociale, covers practically everybody. Because one purchaser pays for nearly each prescription (an association that’s utilized in many international locations across the planet), that purchaser negotiates costs that apply to each buy, and there’s no free market value for pharmaceuticals.

Every particular person drug proceeds by four steps earlier than it has a value and enters the market:

• Authorization (AMM): The drug is authorized for security and effectiveness, normally by the European Medicines Agency. Price is just not mentioned at this stage.
• Grading (HAS): A public company, the Haute Autorité de Santé, evaluates the drug by its Commission de la Transparence. It points two rankings. The SMR decides whether or not the drug is beneficial sufficient to be reimbursed and units the reimbursement charge; and the ASMR measures how a lot better the drug is than current remedies, on a scale from I (main advance) to V (no enchancment), and is the primary driver of value.
• Price (CEPS): A authorities committee, the Comité économique des produits de santé, negotiates the precise value with the corporate. This is the step that issues most for what’s at concern with the present U.S. 301 investigation, for 3 causes given beneath.
• Reimbursement charge (UNCAM): A separate physique units what share of the value the state pays again, and the well being minister formally lists the drug.

The CEPS stage is value specializing in, as a result of it’s the place the value is negotiated between the state and the producer, which is identical sort of authorities price-setting that the investigation in opposition to Germany targets. Three options of CEPS matter right here:

• It is not independent. CEPS sits below the authority of the well being, social safety, and macro economy ministries. The state appoints its president and holds nearly all of its seats.
• The firm can’t merely stroll away. If no settlement is reached, CEPS sets the price by its own decision. The related ministers can override that call, collectively setting the value themselves inside fifteen days, however the preliminary determination by CEPS doesn’t require approval.
• The printed value is just not the actual value. On high of the official value, the producer pays confidential rebates (remises) again to the state, negotiated drug by drug. So the checklist value overstates what France really pays.

The CEPS stage is prone to be the main focus of a Section 301 investigation. The first two are scientific judgments, whereas the third is a funds determination. And the confidential rebates in step three are the identical hidden low cost USTR is attacking in Germany. This raises the query: does France present the identical value hole that began the German case?

To examine, we are able to flip to RAND Corporation’s 2022 value comparability, which seems at U.S. costs in comparison with 33 OECD international locations. Its determine for Germany, 3.87 occasions, traces up nearly precisely with USTR’s 3.9× declare, which makes it a dependable benchmark for measuring France in the identical means. The RAND Corporation finds that U.S. costs for brand-name medicine are 445% of French costs and 387% of German costs. In different phrases, the U.S. pays about 4.45 occasions French costs versus 3.87 occasions German costs. RAND states plainly that France and Japan typically have the bottom costs for brand-name medicine among the many 33 OECD international locations within the evaluation.

Source: RAND Corporation, International Prescription Drug Price Comparisons: Estimates Using 2022 Data (RRA788-3), Figure 3.2, p. 17.

The similar sample seems within the HHS/ASPE analysis of the identical information: U.S. brand-name costs have been 422% of the typical throughout 33 OECD international locations, whereas U.S. generic costs have been really decrease, about 67% of different international locations’ costs. The value hole is subsequently a brand-name phenomenon. On generics, which make up 90% of U.S. prescription quantity, the U.S. pays lower than its friends.

There are two caveats to bear in mind. All of those figures are gross, list-based costs. RAND might modify the U.S. aspect down for rebates (bringing the brand-name determine from 422% to 308%), however it couldn’t do that adjustment for international locations the place there are confidential rebates. RAND notes particularly that “German illness funds obtain statutory rebates not mirrored in producer gross sales.” France’s remises work the identical means. So the true hole that France has is definitely smaller than 4.45 occasions by an unknown quantity. However, the primary declare holds: on brand-name medicine, the class USTR is concentrating on, France is an even bigger outlier than Germany.

The French response

France is just not united on the problem, with a robust inside divide rising. In 2026, a uncommon coalition fashioned on a proposal to make the actual, web costs of medication public, as a substitute of preserving the rebates secret. The left (La France insoumise, the Socialists, the Communists) and the National Rally, events that agree on nearly nothing, all supported it. In parliament, opposition got here from the presidential majority, which voted in opposition to. The government and the related ministries additionally warned that transparency would strip France of its foremost bargaining instrument, prompting some criticism, comparable to from Médecins du Monde.

Other teams have entered the talk too:

• Industry (LEEM): The drugmakers’ affiliation, LEEM, needs the federal government to freeze value cuts and abolish the safeguard clause (a yearly cap on whole drug spending: if nationwide drug gross sales exceed the restrict, producers collectively pay again the overage). It warns that new tariffs on medicines would threaten affected person entry and drug provide. LEEM was additionally questioned directly by the Assemblée nationale on pricing mechanisms in March 2025.
• Critical press (Veltis/Le Figaro): The argument right here is that if the U.S. forces decrease costs at house, firms will increase costs in Europe to compensate, and France, with a number of the lowest costs in Europe, is essentially the most uncovered. Veltis, a consultancy quoted by Le Figaro, put it bluntly: to guard their foremost market, firms “must increase the costs negotiated in Europe… or quit promoting their new medicine there.”
• Reformist (Bizard): The economist Frédéric Bizard argues that France ought to deal with the American stress as an opportunity to rebuild a pricing mannequin he considers damaged, quite than a risk merely to withstand. He additionally confirms the mechanism that connects the American coverage to France immediately: as a result of the U.S. now targets the bottom value in Europe, and that value is commonly France’s, firms comparable to Pfizer threaten to not launch new medicine in France in any respect.

Some tentative predictions

So, would a Section 301 investigation alongside the traces of the one underway in opposition to Germany work in opposition to France? Just trying on the numbers, in case you apply USTR’s evaluation of the German insurance policies to the French state of affairs, the case is there. The value hole that justified the German investigation is just not solely current for France, it’s bigger. And the French system concentrates price-setting in a state committee, which supplies proof of a authorities observe of the kind Section 301 is designed to deal with. At the identical time, whether or not any such practices – in Germany, France, or elsewhere – are “unreasonable or discriminatory” and “burden or prohibit U.S. commerce” is a query nonetheless open for debate (though the Trump administration’s views on this are most likely not doubtful at this level). 

A complicating issue right here is identical one operating by the entire story: France’s low costs come partly by confidential rebates, the identical secrecy USTR is attacking in Germany. That makes the hole actual however laborious to measure precisely. Whether the administration turns to France subsequent might come down to not the power of the case, however to the actual priorities of the Trump administration, together with numerous non-trade facets of the U.S.-French relationship.