Sun Pharma agrees to supply at MFN pricing to U.S. medicaid programmes

Sun Pharmaceutical Industries will extend Most Favoured Nation (MFN) pricing to state medicaid programmes of the U.S. It has also committed to MFN pricing for future innovative medicine launches.

The announcement followed a White House ceremony on August 31, in which the U.S. government signed agreements with nine pharmaceutical companies, including Sun Pharma, aimed at improving access to affordable medicines for millions of Americans.

Sun Pharma said the agreement recognises its investment in the U.S. market by delaying Section 232 tariffs on innovative pharmaceutical products for over two years. Further terms of the agreements remain confidential, the company said.

“The United States is a key area of investment and expansion for Sun Pharma across clinical development, sales and marketing, and both API and finished products manufacturing. We are proud to play our part in delivering the medicines that millions of American patients count on every day,” said Rick Ascroft, North America CEO, Sun Pharma, who represented the company at the White House.

The company said it built its U.S. presence on a foundation of high-quality generic medicines, followed by an increasing focus on innovative and specialty products. It ranks second in the U.S. by prescriptions in dermatology and continues to expand its presence across dermatology and immunology, cutaneous oncology, and ophthalmology. These businesses complement its strong portfolio of consumer health products and generics.

The U.S. is the company’s largest market for innovative medicines and a cornerstone of its long-term growth strategy, generating approximately 27% of the company’s global revenue. Earlier this year, Sun Pharma signed a definitive agreement to acquire Organon & Co in a deal valued at $11.75 billion.

The White House said the nine new agreements are part of President Donald Trump’s initative to lower prescription drug prices for Americans in line with the lowest prices paid by other developed nations (known most-favoured-nation price). With the latest agreements, 26 pharmaceutical manufacturers now have signed MFN deals, covering 89% of the branded drug market.

Alcon, Astellas Pharma, BeOne Medicines, BridgeBio, CSL, Kyowa Kirin, Sun Pharma, Teva Pharmaceuticals, and UCB are the nine manufacturers.

The agreements will provide every State Medicaid programme in the country access to MFN drug prices on products made by the nine companies, resulting in billions of dollars in savings for Americans.

The nine manufacturers have committed to invest at least $19.6 billion collectively in U.S. manufacturing in the near term. Additionally, as part of the agreements, several companies are donating active pharmaceutical ingredients for key products to the Strategic Active Pharmaceutical Ingredients Reserve (SAPIR) to reduce reliance on foreign nations and ensure the U.S. has an adequate supply of such products in the event of an emergency, the White House said.

Sun Pharma will contribute 71.4 tonnes of clindamycin and 6.75 tonnes of doxycycline — both antibiotics — to the SAPIR.

Medicaid is jointly funded by States and the federal government in the U.S. and provides health coverage to millions of Americans, including eligible low-income adults, children, pregnant women, elderly adults and people with disabilities.