Trump Threatens 200% Tariffs on Pharma Imports, Proposes 1-Year Grace Period for Onshoring
President Trump has announced a plan to impose a 200% tariff on imported pharmaceutical products, warning that these tariffs could be implemented after a proposed grace period for companies to shift manufacturing to the US123.
The proposed grace period is approximately one year to a year and a half, during which pharma companies would have time to adjust their supply chains and increase US-based manufacturing1234.
Trump made these comments at a recent cabinet meeting and reiterated the plan from earlier statements, emphasizing "tremendous amounts of drug and pharmaceutical companies" moving to the US13.
The move is seen as part of an effort to encourage onshoring of pharmaceutical production, but industry analysts warn that building new US manufacturing capacity could take several years, far longer than the proposed grace period2.
The scale of US pharma imports is significant, with Ireland, India, and China being major exporters to the US market3.
Major pharmaceutical companies such as Eli Lilly, Johnson & Johnson, Novartis, and Bristol Myers Squibb have already announced increased investments in US manufacturing1.
Analysts and market commentators note skepticism regarding both the feasibility and final implementation of the tariffs, as well as concerns about potential negative impacts on medicine prices and supply chains12.
Sources:
1. https://www.biospace.com/policy/trump-threatens-200-pharma-tariffs-but-gives-at-least-1-year-grace-period
2. https://www.clinicaltrialsarena.com/news/trumps-200-tariff-threat-could-send-shockwaves-through-pharma-supply-chains/
3. https://www.fiercepharma.com/pharma/trump-renews-200-tariff-threat-pharmaceuticals-indicates-1-year-grace-period