Drug price cuts: what is Trump planning and what will it mean for big pharma?

Donald Trump has used his executive powers to order sweeping cuts to the price of prescription drugs in the US, in an effort to bring them in line with other developed countries.

The plans, first announced in a social media post on Sunday, triggered a sharp fall in drugmakers’ share prices on Monday. However, these later reversed amid growing scepticism that the shake-up would be as severe as promised.

What is Trump proposing?

His order directs the US health secretary, Robert Kennedy, to send price targets to the pharmaceutical industry and kick off a round of negotiations within 30 days to reduce prices from their current levels. The US currently pays by far the most for its medications.