WASHINGTON (AP) — President Donald Trump on Monday enacted a comprehensive executive order mandating drug manufacturers to voluntarily reduce prescription drug costs in the U.S. within 30 days, or risk facing future restrictions on government reimbursement levels.

The directive mandates that the health department, under Robert F. Kennedy Jr.'s leadership, negotiate new drug prices over the following month. Should no agreements be forthcoming, Kennedy will be responsible for formulating a regulation linking U.S. medication costs to the lower prices prevalent in other nations.

Trump stated at a press conference on Monday morning, "We intend to achieve parity; everyone will contribute an equivalent amount, aligning with the contributions made in Europe."

The potential effects of the Republican president’s executive order on the millions of Americans holding private health insurance remain uncertain, if any. The federal government possesses considerable leverage in determining the cost of medications included in Medicare and Medicaid coverage.

Hours after the Republican-controlled House revealed its revised proposal to reduce Medicaid expenditure by $880 billion, Trump announced prospective, albeit unverified, reductions in drug costs.

The nation's pharmaceutical lobby, representing leading U.S. drug manufacturers, immediately countered Trump's directive, lambasting it as detrimental to American patients. Pharmaceutical companies have consistently contended that any jeopardizing of their profitability could impede their research and development efforts for novel medications.

Stephen J. Ubl, the head of PhRMA, said that using prices from other countries would be bad for American patients and workers. He added that it would mean fewer treatments and cures and put at risk the large investments their companies plan to make in America.

Trump's plan to make the US pay lower prices for some Medicare drugs, like other countries do, has caused arguments since he first suggested it. He signed an order later saying the US should only pay the lower price that other countries pay for certain drugs, such as shots or cancer drugs given through IVs, when they are given in a doctor's office.

The restrictive executive order encountered obstacles, including a judicial decree that prevented its implementation under President Joe Biden's administration. The pharmaceutical sector contended that Trump's 2020 effort would grant foreign governments an advantage in determining the price of pharmaceuticals in the U.S.

On Monday at the White House, in a comprehensive speech, Trump consistently advocated for pharmaceutical companies, attributing the high cost of medications for Americans to other nations. The president was accompanied by Kennedy, Centers for Medicare and Medicaid Services administrator Dr. Mehmet Oz, Food and Drug Administration commissioner Dr. Marty Makary and National Institutes of Health director Jay Bhattacharya.

Nevertheless, he cautioned the corporations about potential federal probes into their operations and facilitating the influx of imported pharmaceuticals from other nations into the U.S. market.

"Pharmaceutical corporations primarily generate their profits within the American market," Trump stated. "This situation is rather undesirable."

Over the weekend, Trump accentuated the announcement, claiming in a post that his plan held the potential to save "TRILLIONS OF DOLLARS."

However, on Monday, the White House provided no concrete details regarding the extent of the savings the administration expects to achieve.

Over the forthcoming month, senior figures from the health department are scheduled to convene with pharmaceutical executives, proposing revised drug prices informed by international benchmarks, Oz announced on Monday.

According to Rachel Sachs, a health law expert at Washington University, this order is unlikely to bring immediate relief from rising drug costs for Americans.

"It genuinely appears the strategy is to request manufacturers to voluntarily reduce their prices to an unspecified level," Sachs stated. "Should they fail to lower their prices to the intended level, HHS will undertake alternative measures with an extended timeframe, some of which might, potentially years from now, result in lower drug prices."

The health department has a lot of power to change the prices of drugs for Medicare and Medicaid because it can make rules. However, this power is not unlimited. In 2022, Congress passed a new law that lets Medicare negotiate the price for a few prescription drugs starting in 2026. Before this law, Medicare paid whatever the drug companies asked. Drug companies tried to stop the law in court but did not succeed.

The cost of medications for millions of privately insured Americans is even more resistant to agency manipulation.

The U.S. regularly spends more on drug prices than other big, rich countries. This problem has made both major political parties angry for a long time, but Congress has never passed a permanent solution.

When Trump started his first term, he said pharmaceutical companies were "getting away with murder." He also complained that countries where the government sets drug prices were taking advantage of Americans.

Before the announcement, Trump again used strong words against the industry on social media. He wrote that drug companies had said for years that research and development costs, which they claimed had no reason, were paid for only by Americans, who he called 'suckers.'

He stated that money given to campaigns could influence some people, but it would not affect him or the Republican Party, especially considering the strong efforts of drug companies to influence politicians.

He affirmed their commitment to acting ethically.

On Monday morning, several pharmaceutical companies saw their stock values increase significantly, with key players like Merck, Pfizer, and Gilead Sciences experiencing notable gains.