Belgium's Deputy PM Urges EU to Ready 'Trade Bazooka' Over US Drug Price Pressure

Belgium's deputy prime minister Frank Vandenbroucke has called on the European Union to ready its Anti-Coercion Instrument, known as its “trade bazooka,” for use against Washington over its push to raise EU drug prices.

Vandenbroucke, who also serves as health minister, issued the call in a position paper published on Thursday by the Egmont Institute think tank, co-authored with his deputy head of cabinet Gloria Ghéquière.

He also said the EU should be ready to suspend the tariff concessions it granted to Washington under the Turnberry trade deal from August 2025 if the US imposes additional duties on European goods.

The Trump administration has been pressuring European governments to pay more for medicines under its “most-favored-nation” policy, as it seeks to bring American drug prices into line with those in other wealthy countries.

Washington argues that Americans are unfairly shouldering the costs of pharmaceutical research and development, while Europeans reap the benefits.

The MFN policy ties American drug prices to the lowest prices charged in a basket of wealthy countries, including France, Germany and Italy. The US has already concluded MFN pricing agreements with 26 pharma companies, which have agreed to benchmark the prices of drugs supplied to the US Medicaid program.

In June, the US launched a Section 301 investigation into Germany's alleged “persistent underpayment” for innovative drugs. The investigation could lead to additional tariffs exceeding the 15 percent ceiling agreed under Turnberry.

Capitals are banding together to counter the US pressure. At an informal meeting in Dublin last week, ministers from Ireland, France, Germany, Italy, Denmark, Sweden, the Netherlands and Belgium discussed creating an EU-wide pharmaceutical task force to coordinate their response.

French Trade Minister Nicolas Forissier told Politico: “If we don’t work together and act as a team, countries are inevitably tempted to go it alone.”

In the paper, Vandenbroucke and his co-author argue that Brussels should open an ACI investigation in response to Washington's drug pricing policy. The instrument allows the EU to impose tariffs and restrictions on services in response to foreign threats to trade if backed by a qualified majority of member countries.

The paper argues: “The procedure is quite heavy, but already opening an examination would have an effect of its own.”

The authors also highlight a clause in Pfizer's MFN agreement requiring it to share additional revenue from higher prices outside the US with the American government. “Higher foreign payments thus become a source of revenue for the American government itself,” they write.

Vandenbroucke, an economist by training, said the net effect would likely be an extreme increase in European drug prices — or the withdrawal of drugs from the market — while producing comparatively modest price cuts in the US.

According to one forecast cited in the paper, prices could triple in countries used as benchmarks, while US prices would fall by just 7.5 to 15 percent.

The authors warn: “The consequences would reach well beyond the medicines budget, putting pressure on the solidarity that universal insurance is designed to secure.”