July 5 (UPI) -- President Donald Trump on Friday said his administration intends to announce a plan to decrease prescription drug costs based on the lowest price other countries pay.
He called it a "favored-nations clause."
"As you know, for years and years, other nations paid less for drugs than we do," he told reporters gathered on the South Lawn of the White House. "We're working on it right now, we're working on a favored nations clause, where we pay whatever the lowest nation's price is."
Trump said he will sign an executive order to implement the plan.
"Why should other nations, like Canada, ... pay much less than us?" he asked. "They've taken advantage of the system for a long time, pharma."
The announcement comes less than two weeks after Trump signed an executive order to improve the transparency of healthcare costs. The order requires hospitals and insurance companies to tell patients their rates for medical services and what patients will be expected to pay out of pocket before undergoing treatment.
Since his inauguration, Trump has made reducing prescription drug costs a priority of his administration.
In May, Health and Human Services Secretary Alex Azar announced a rule that requires pharmaceutical companies to reveal the prices of drugs they advertise in television ads. The same month, though, the Trump administration tabled the implementation of a proposal to cut drug prices for Medicare patients.
In October, Trump signed a pair of bills lifting so-called gag orders that prevent pharmacists from telling customers how to save money on prescription drugs.
A study released in March 2018 found that the costs of certain brand-name drugs are increasing at 10 times the rate of inflation. The report found prices increased an average of 12 percent every year for the Top 20 most commonly prescribed brand-name drugs under the Medicare Part D program from 2012 to 2017.