Jim Cramer Says 'Price Controls Are Not Like Tariffs' — Urges Drugmakers To Challenge Trump's Plan With 'Injunction'
Jim Cramer has raised concerns over the constitutionality of recent drug price controls, urging pharmaceutical companies to seek an injunction.
What Happened: CNBC’s Mad Money host, Cramer, in a post on X on Monday, argued that, unlike tariffs, drug price controls fall under the Commerce Clause of the Constitution and suggested they may not hold up under legal scrutiny.
This follows President Donald Trump's May 12, 2025, announcement to align U.S. drug prices with lower international rates—a move that triggered a decline in pharmaceutical stocks. Cramer's push for an injunction is a calculated effort to challenge the policy, citing federal overreach as a legal basis.
“The drug companies should move for an injunction today, or they are really ill-advised,” wrote Cramer.
Why It Matters: Trump’s announcement, described as the "most consequential executive order" in U.S. history, intends to implement a "Most Favored Nations" policy. This policy requires pharmaceutical companies to charge U.S. consumers no more than the lowest price they offer for the same drug in any other country.
Trump’s move is expected to slash prescription drug prices by 30% to 80% ‘almost immediately.’ However, Cramer’s argument suggests that this policy may face legal challenges. In another post on Truth Social on Monday, Trump specified that he would lower drug prices by 59%.
Meanwhile, billionaires Mark Cuban and Bill Ackman have shown support for Trump’s executive order. Cuban has also pointed out that Pharmacy Benefit Managers (PBMs), not Big Pharma, are the main culprits behind high drug prices due to their opaque pricing practices and market dominance, urging Trump to force transparency.
Notably, the U.S. pays nearly three times more for prescription drugs than other developed nations and Trump's first-term attempt to lower prices was blocked by the courts.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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