In addition to slashing the price of Zepatier, which owns a very small share of the hepatitis market, Merck said it would lower the list price by 10 percent of six other older drugs with minuscule sales.
The decision comes a little over a week after President Donald J. Trump singled out rival Pfizer over its price increases.
But those drugs make up less than 0.1% of Merck's overall sales, Evercore ISI analyst Umer Raffat said in a note on Thursday.
Merck's announcement comes days after Novartis decided against raising US prices on its prescriptions drugs, and Pfizer recently postponed planned price increases for almost 100 drugs, a decision that came after a meeting with the president. "We are making a big push to actually reduce the prices, maybe substantially, on prescription drugs".
We commit to not increase the average net price across our portfolio of products by more than inflation annually. In fact, Merck did not record any US sales for the product in the first quarter of this year. He also threatened that the administration would "respond".
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Trump, along with other politicians across the political spectrum, has regularly targeted drug companies for ostensibly greedy price-hiking habits. He has not yet commented on Merck's announcement.
Both Pfizer and Novartis have said that they will not take the price increases that the industry typically takes at the end of the second quarter, and will instead hold off on those increases until next year.
"This decision is a response to President Trump's blueprint and reflects the industry's understanding that the President is serious about bringing change to our drug markets", U.S. Secretary of Health & Human Services (HHS) Alex Azar said in a statement that praises Merck's decision.
Trump announced in May a plan to lower drug prices by, among other things, giving the government better tools to negotiate drug prices for Medicare beneficiaries and counter foreign government regulations that often keep drug prices artificially low.
The president himself has made pharmaceutical companies targets of his barbed tweets.