Trump Fights Big Pharma with Drug Plan, China Tariffs Pause, American Hostage Free： AM Update 5⧸13
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Summary
Starting today, the United States will no longer subsidize the health care of foreign countries. President Trump signs an executive order he says will be one of the most impactful orders ever signed, aimed at reducing drug prices, some up to 80% for American consumers.
Transcript
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Good morning, everyone. I'm Megan Kelly. It's Tuesday, May 13th, 2025, and this is your AM
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Update. Starting today, the United States will no longer subsidize the health care of foreign
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countries. President Trump signs an executive order he says will be one of the most impactful
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orders ever signed, aimed at reducing drug prices, some up to 80 percent for American consumers.
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I think it's going to be fantastic for China. I think it's going to be fantastic for us.
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The Trump trade team announcing a temporary deal with China, reducing reciprocal tariffs for 90
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days as both sides work toward a new trade agreement. New details on the Qatari government's
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lavish gift to the Trump White House come into focus as President Trump weighs in. And the last
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known living American hostage released from Hamas custody. All that and more coming up in just a
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President Trump on Monday signing an executive order he called, quote, one of the most important
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and impactful I have ever issued. The order is seeking to lower prescription drug prices by as much
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as 80%, primarily by tying U.S. prices to those paid for the same drugs in other developed countries,
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a fundamental change to how the U.S. negotiates drug prices. The U.S. has less than
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5% of the world's population, yet it generates around three-quarters of global pharmaceutical
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profits. Astronomically high drug prices consistently sparking bipartisan outrage among U.S. lawmakers,
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even as Democrats and Republicans historically clashed over how to fix it. American consumers pay
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many times over what people in other countries pay for the same drug made in the same factory.
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For example, American website GoodRx.com ranges a twin pack of EpiPens from $650 to $750 without
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insurance versus an online U.K. pharmacy listing the same two-pack at $112. Yahoo Finance reporting
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weight loss drug Wegovi costs about $1,300 in the U.S. compared to $140 in Germany. President Trump
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saying the U.S. will no longer accept the status quo. Starting today, the United States will no longer
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subsidize the health care of foreign countries and will no longer tolerate profiteering and price
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gouging from big pharma. But again, it was really the countries that forced big pharma to do things
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that frankly, I'm not sure they really felt comfortable doing. For years, pharmaceutical and
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drug companies have said that research and development costs were what they are. And for no reason
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whatsoever, they had to be borne by America alone. Whatever the lowest price paid for a drug in
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other developed countries, that is the price that Americans will pay. Pharma stocks actually rising
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in response to the announcement as the Trump administration also assigns some of the blame
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for high U.S. prices on other countries for forcing unfairly low prices in their markets,
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sending the drug manufacturers to recoup costs from Americans. The president specifically naming the
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EU as one of the worst offenders. Progressive news site Vox breaks down how the U.S. system works
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compared to most other developed countries. In the U.K., the government buys the stock of medicine
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for the country. That means they're usually able to get a lower rate, kind of like a bulk discount.
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In almost every developed country besides the U.S., this is what the system looks like. Safety evaluation,
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assessment of whether the country needs it, price negotiations sold to patients.
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Now let's look at the system in the United States. First, the drug is evaluated for safety,
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but that's it. If it's safe, they can sell it. End of story. Drugs are sold by the drug companies
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to patients, usually through insurance. Regulated drug markets tend to make drugs more affordable,
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but some drugs are completely unavailable. And while the U.S. has more drugs technically available,
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they're often too expensive to actually afford. For decades, the prevailing logic in U.S.
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health care held that high drug prices were the price of innovation. The steep costs for American
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consumers were seen as an unfortunate but necessary side effect, with limited political will to change
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the system until now. From the executive order, quote, drug manufacturers, rather than seeking to
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equalize evident price discrimination, agree to other countries' demands for low prices and
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simultaneously fight against the ability for public and private payers in the U.S. to negotiate the best
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prices for patients. The inflated prices in the United States fuel global innovation, while foreign
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health systems get a free ride. NIH head Dr. Jay Bhattacharya further elaborating from the Oval.
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What we're going to do is make sure that those prices become much closer to equal, like a
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competitive market you'd expect. You may think of it as somehow it's like it's going after drug
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companies. Actually, it's helping drug companies. Because what we're also going to do with this order,
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what President Trump has done with this order, is he's said to European governments, look, if you
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are taking advantage of the drug companies by forcing them to charge very, very low prices,
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we're going to defend American drug companies in Europe. At the same time, we're standing up for the
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American consumer who's been paying far too high prices for far too long. Dr. Oz, head of Medicare and
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Medicaid, comparing the strategy to President Trump's strategy with NATO. Other countries will have to pay a
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little more, but the U.S. will get a long needed and deserved break. Barron's Magazine, referring to
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the order as a blessing in disguise for pharma companies, saying it is, quote, fundamentally
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restructuring the U.S. drug industry in a way that hurts pharmacy benefit managers. Pharmacy benefit
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managers are middlemen in the prescription drug supply chain, managing which drugs are covered under
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insurance, how much they cost, and what patients will pay. President Trump saying this order will provide
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a workaround to those managers who are also disliked by big pharma. We're going to totally
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cut out the famous middlemen. We're going to cut out the middlemen and facilitate the direct sale of
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drugs at the most favored nation price directly to the American citizen. The order provides a 30-day
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window for the drug companies to begin negotiating with HHS. If Secretary Kennedy does not feel adequate
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progress has been made on negotiations to reduce prices within that time, the executive order says the
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secretary may then simply impose something called most favored nation pricing, which means using the
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regulatory process to tie U.S. prices to the lowest price paid by any major developed country. Among other
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actions in the order, it directs the FDA to look into increasing drug exports from other countries and
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directs the DOJ and Federal Trade Commission to crack down on anti-competitive actions forcing artificially
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high prices. President Trump attempted a similar, though less expansive, executive order in his first
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administration, and it was blocked by a court as a usurpation of Congress's power. We'll see if Big Pharma
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files a similar legal challenge here. On Sunday, the Trump administration announcing a deal after trade
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negotiations with China. Over the weekend, the U.S. team, headed by Treasury Secretary Scott Besant, meeting face-to-face
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with Chinese negotiators, agreeing to a 90-day pause on the reciprocal tariffs beginning this Wednesday.
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Both nations agreeing to cut tariffs by 115 percent, China lowering tariffs on U.S. goods to 10 percent,
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the U.S. lowering tariffs on Chinese goods to 30 percent. That's 10 percent plus a 20 percent tariff
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to message to the Chinese that we are serious about stopping the fentanyl they're sending here,
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typically via Mexican cartels. Ongoing talks will focus on opening Chinese markets to American-made
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goods and on cooperation in the war against fentanyl, a war the Chinese have been waging against
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us. President Trump on Monday confirming that higher tariffs will remain in place for Chinese imports
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in key national security sectors like cars, steel, and aluminum. Secretary Besant framing the goal this
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way, open markets for U.S. exports, and bring home manufacturing for critical materials.
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We do not want a generalized decoupling from China, but what we do want is a decoupling for strategic
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necessities, which we were unable to obtain during COVID, and we realized that efficient supply chains
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were not resilient supply chains. So we are going to create our own, protect our steel industry,
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the work on critical medicines, on semiconductors. So the reciprocal tariffs have nothing to do with
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the specific industry tariffs. Markets ripping in response to the announcement, the Dow Jones,
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NASDAQ, and S&P 500 each shooting straight up. President Trump reacting positively to this first
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phase of negotiations from the Oval. The talks in Geneva were very friendly. The relationship is very
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good. We're not looking to hurt China. China was being hurt very badly. They were closing up
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factories. They were having a lot of unrest. And they were very happy to be able to do something
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with us. The relationship is very, very good. Because if you think about it, we opened up our country to
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China. They come, we don't, I mean, they have very few restrictions. And they didn't open their country
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to us. Never made sense to me. It's not fair. And they've agreed to open China, fully open China.
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I think it's going to be fantastic for China. I think it's going to be fantastic for us.
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China will also suspend and remove all of its non-monetary barriers. They've agreed to do that.
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President Trump set to speak with Chinese President Xi Jinping later this week.
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Coming up, President Trump slams ABC's reporting on the $400 million luxury jet the Qatari government
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is preparing to gift our government. And the last living American hostage is released from Hamas custody
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as President Trump promises to keep working for the release of the deceased Americans still held
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It was not supposed to get this bad. You were on top of your bills and then inflation hit.
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President Trump on Monday offering new details on plans to accept a luxury Boeing 747 dubbed a palace
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in the sky from the Qatari government following backlash, including from several Republicans who say
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the gift smacks of impropriety. Mr. Trump responding at a press conference yesterday.
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Mr. President, what do you say to people who view that luxury jet as a personal gift to you? Why
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not leave it behind? You're ABC fake news, right? It's only ABC. Well, a few of you would. Let me tell
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you, you should be embarrassed asking that question. They're giving us a free jet. I could say, no,
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no, no, don't give us. I want to pay you a billion or 400 million or whatever it is.
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Or I could say, thank you very much. You know, there was an old golfer named Sam Snead. Did you
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ever hear him? He won 82 tournaments. He was a great golfer. And he had a motto. When they give
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you a putt, you say, thank you very much. You pick up your ball and you walk to the next hole. A lot of
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people are stupid. They say, no, no, I insist on putting it. Then they putt it and they miss it.
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And their partner gets angry at him. Have you ever been given a gift worth millions of dollars
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and did not receive it? It's not a gift to me. It's a gift to the Department of Defense.
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The president also clarifying that the plane will not be put to personal use after he leaves office.
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Do you plan to use the plane after you leave office? No, I don't. No, it would go directly
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to the library after I leave office. I wouldn't be using it, no. That could help the president's
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argument that this was not a gift to him personally, even if it would eventually wind up in the Trump
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presidential library, helping him to potentially avoid constitutional muster. Some critics on the
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right still feel Qatar is too questionable a friend to accept a $400 million plane from.
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The last known living U.S. hostage held by Hamas, Idhan Alexander, released on Monday after more than 19
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months in the custody of the terrorist organization. The 21-year-old transferred from Hamas to the Red
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Cross to Israeli Special Forces, where he was then brought back into Israel for medical evaluation.
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Though born in Tel Aviv, Mr. Alexander was raised in New Jersey, joining the Israeli Defense Forces
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straight out of high school. He was captured by Hamas at his military base during the October 7th
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attack. On Sunday, the Alexander family releasing this statement, quote,
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Today, on Mother's Day, we received the greatest gift imaginable, news that our beautiful son,
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Idhan, is returning home after 583 days in captivity in Gaza. We express our deepest gratitude to President
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Trump, Steve Witkoff, and the U.S. administration for their tireless work to make this happen.
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The moment here when Mr. Alexander's mother was able to speak to her son by phone for the first time.
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Oh my God, Idhan! I love you, and I'm going to see you, like, soon. Very soon.
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En route home to a tearful family reunion, Idhan held up a sign on board the plane reading,
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Thank you, President Trump. Speaking from the Oval, President Trump saying the U.S. will work to
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recover the bodies of deceased Americans still held in Gaza.
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We hope that we're going to have other hostages released, too. When I met with the hostages three
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weeks ago, and I said, how many are there? They said, 59. I said, that's a lot. They said, 59.
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But then they said, they followed that up by saying 59, of which 24 are living, the rest are dead.
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I have a mother that calls me, but came up to me when I first met her, and she said, sir, please,
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please get my son out. He's dead, but they have his body. And I asked her about that,
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and it's as though he were alive. The level of wanting that body back is the same. It couldn't
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be anymore, as though he were alive. So, you know, getting the bodies back is very important.
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U.S. officials say the bodies of four Americans are still being held by Hamas.
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President Trump is offering to meet with Mr. Alexander in Qatar later this week
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during his Middle East trip, if Mr. Alexander is feeling up to it.
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Peruvian fans of Robert Prevost, now better known as Pope Leo XIV, reacting like fans at a World Cup
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championship as they heard their former priest's name announced as the new pontiff.
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Pope Leo was bishop in the diocese of Chiclayo, Peru, from 2015 to 2023. This video of seminarians
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within the diocese posted by SemiFabian24 on TikTok. Clearly, Leo left an impression.
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And that'll do it for your AM update. I'm Megan Kelly. Join me back here for The Megan Kelly Show,
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live on SiriusXM Triumph Channel 111 at New East, on youtube.com slash megankelly,
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and on all podcast platforms. By the way, if you listened yesterday and heard my kids do the AM
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update, and thank you for all the sweet feedback, and you want to hear the outtakes from that recording,
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