Trump reiterates plan to impose tariffs on pharmaceuticals

 During a meeting with his cabinet Monday, President Donald Trump said that tariffs on pharmaceuticals would begin in the "not too distant" future.

The president didn't provide specifics on whether the tariff would apply to imports from all countries, and whether it would apply to finished drugs and/or active pharmaceutical ingredients (APIs), the raw materials that make up medicines.

He made the comments while also discussing imports of cars and aluminum, which he plans to impose a 25% tariff on early next month.

"We don't make pharmaceuticals anymore in our country," he said, adding that domestic production is important should the U.S. get involved in wars or experience other supply chain issues.

There are no regulations that require the disclosure of where a drug's API came from or the location of manufacture of the finished product.

According to the U.S. Pharmacopeia, an independent, non-profit organization that establishes quality and safety standards for medicines, as of 2021, India manufactured nearly half -- 48% -- of the APIs made into drugs consumed in the U.S. Europe made 22%, and China, 13%. Just 10% of APIs in 2021 were manufactured in the U.S.

The vast majority of APIs are used in the manufacture of generic drugs, which account for 91% of the prescription drugs dispensed in the U.S., though generics account for just 18% of total drug spend, according to the Association for Accessible Medicines.

Interestingly, most brand-name drugs sold in the U.S. have their APIs and finishing done in the U.S. or a country with stringent manufacturing regulations. A 2022 evaluation of the top 100 Medicare Part D drugs based on spend from PharmacyChecker Research found that 32 were finished in the U.S. and another 67 were finished in countries that have strong pharma manufacturing protocols such as European Union countries, Canada, Japan, Singapore, Switzerland, and the United Kingdom. 

When Trump first discussed tariffs on Mexico, Canada, and China in early February, generic and other pharma stakeholders expressed their concerns.

Since then, several drug companies, including Johnson & Johnson (NYSE:JNJ), Eli Lilly (NYSE:LLY), and Merck (NYSE:MRK) have announced plans to boost production domestically. Pfizer (NYSE:PFE) CEO Albert Bourla has also said he is considering moving more production back to the U.S. 

https://www.msn.com/en-us/money/markets/trump-reiterates-plan-to-impose-tariffs-on-pharmaceuticals/ar-AA1BzjNX