President Trump’s decision to approach the imposition of definitions on imported drugs is major political risks, because Americans may face higher prices and a further deficiency in critical drugs.
Trump administration He made a federal notice On Monday, she began to investigate whether imports of pharmaceutical drugs and components threaten US national security, an attempt to lay the foundation to obtain a possible tariff on foreign drugs.
Mr. Trump has repeatedly said he intends to impose such fees, to transfer production abroad to medicines to the United States. Experts said the definitions are unlikely to achieve this goal: the transfer of manufacturing will be very expensive and will take years.
It was not clear how long the investigation would continue or when the planned definitions enter into force. Mr. Trump began an investigation under a legal authority known as Section 232 What it used in other industries such as cars and wood.
Mr. Trump said in statements to reporters on Monday that the drug tariff will come in the “non -far -long future”.
“We no longer make our drugs,” said Mr. Trump. “Ireland’s pharmaceutical companies, and they are in many other places, China.”
While some medications are made at least partially in the United States, America’s dependence on China has caused a warning for years, as both Republicans and Democrats have identified a national security vulnerability.
Many medications are not produced without at least one stage of the manufacturing process that occurs in China. Even the general pharmaceutical sector in India is deeply dependent on China, because Indian manufacturers usually get their raw materials from Chinese plants.
The imposition of sabotage on life -saving drugs creates risks to Mr. Trump, which was not a great concern with some of his other identification goals, such as steel and aluminum, as Americans are generally not exposed directly to increasing prices.
A harsh violent reaction may face if the pharmaceutical tariffs lead to a significant increase in drug prices or a shortage of patients. The number of drug shortages has reached a Standard high level last year. Americans fill several billion prescriptions annually, as well as buying without prescription products such as cough syrup and teelinol.
Mr. Trump did not talk a lot about the reduction of drug prices in his second term, and did not make it a higher issue in his 2024 campaign.
If the pharmaceutical tariffs cause increased prices of medicines, Democrats can jump on this issue in the mid -renewal elections next year and try to undermine the popularity of Mr. Trump among voters from the working class.
Democrats have already seized this issue. in letter It was sent to Trump officials last week, and a group of legislators led by actors Doris Matsoy from California and Brad Schneider from Illinois wrote that a “reckless tariff” on the drugs that threatened to harm the Americans.
They wrote: “Disturbances of critical medical products will harm patients who cannot be avoided, and forcing service providers to make impossible traditional decisions, and may even lead to death with delaying treatments, or the most effective drugs and products are replaced by less effective alternatives.”
“President Trump has been a long time ago about the importance of re -manufacturing, which is necessary for national and economic security in our country,” White House spokesman Cush Disai said in a statement on Monday.
Supporting drugs also aims to have more relations with allies such as the European Union and India, which is supported by drug export economies to the United States. Officials of those countries fear that drug tariff can push companies to promote On investmentsWhich led to the loss of jobs, factories and tax revenues.
In addition to cars and electronics, the drugs are one of the goods of goods MoreMeasured by value.
Drug -related definitions will add tens of billions of import costs for a strong industry that depends on the complex global supply chain. The production of most drugs consumed in the United States occurs in more than one part of the world, With plants in different countries Dealing with different stages of the process.
Patent -expensive drugs are likely to be offered, such as the famous Wegovy weight loss, in Europe or the United States.
China and India perform most of the cheapest general medications, which represent the vast majority of American prescriptions. For example, the plants in those countries prepare almost all active ingredients in the world in the IBUPROFEN and CIPROFLOXACIN antibiotic, according to Clarivate, an industry data provider.
Medicines is the latest sector targeted by Mr. Trump. The 25 % definitions are already valid for imported steel, aluminum and cars. The Trump administration also started investigations into Article 232, or inquiries in national security concerns, for copper, wood and computer chips.
Investigations must be completed under the ruling of 232 within nine months.
The pharmaceutical industry is under the Trump administration to gradually pressure the customs duties or to exempt certain types of products, such as drugs at risk of deficiency or those that are necessary, such as antibiotics.
John Murphy III, head of a commercial group representing public pharmaceutical companies, said in a statement on Monday that the customs tariff “will only inflate the problems that already exist in the American drug market at reasonable prices.”
Customs duties will be paid by pharmaceutical companies that import products or components to the United States. Many of these manufacturers are likely to try to pass at least some additional costs for employers and government programs such as Medicare and Medicaid, which cover most of the tab for the prescribed drugs for Americans. It will eventually affect patients.
Fees can cause a shortage in some cheaper general medications, because prices are very close to production costs. Manufacturers with these thin margins may have to reduce production or finish.
Industry experts said they were not worried about a shortage of branded drugs, which generally have high profit margins that could absorb definitions.
Patients whose insurance requires a deduction or percentage of the price of the drug ultimately can eventually be a high pocket cost of some medications. They may also have to pay a higher payment if the deficiency resulting from the customs tariff force them to turn into a different and dual medicine. In the coming years, people may face higher health insurance premiums.
In some cases, contractual agreements and severe financial penalties may lead to the installation of manufacturers sharply. With patented products, manufacturers usually have large margins so that their sales are still very profitable even if they absorb the cost of definitions.
David Rex, CEO of Elie Lily, BBC said Earlier this month, his company expected to eat the cost of definitions. He said that Lily could reduce research spending or reduce employment as a result.
Mr. Trump was saying that his definitions would demand medicine makers to transfer their production abroad to the United States. In recent weeks, many of the richest companies in industry – Eli Lily, Johnson & Johnson and Novartis – She announced its plans to spend billions of dollars to build new factories in the United States.
But experts say the definitions are almost not enough to return most of the drug production to the United States. The obstacles are especially very slope with decisive general medications. Building a new factory that takes years. The conversion of production into an existing American factory may be very expensive. Work and other production expenses are much higher in the United States.
“If what you want is to build the manufacturing capacity in the United States, whether in Med-Tech or in medicines, the most effective answer is not tariff, but the tax policy,” Joaquin Duato, CEO of Johnson & Johnson, said in a call with analysts on Tuesday.
The Trump administration was aimed at Ireland, where almost all the largest American drug makers enjoyed manufacturing, in some cases dating back to decades. One of the largest calls to Ireland of this industry is the tax advantages it provides. Some drug makers convert their profits there to reduce total tax bills.
Last month, Mr. Trump said that Ireland “took our pharmaceutical companies away.” Howard Lootnick, Minister of Commerce, He said Ireland was running a “tax fraud” that was exploited by American pharmaceutical companies. “This must end,” said Mr. Lootnick.
Some of the largest films in industry are produced, including Keytruda Cancer and Botox anti -wrinkle, partially in Ireland. The United States imports more pharmaceutical products, as it was measured by its value, more than Ireland than any other country.
Irish officials Fearful Pharmaceutical makers can pushing the country’s investments. But experts said that drug makers may hesitate to undergo the expensive and disturbing process of uprooting their operations there, especially while uncertainty continues in the period in which Mr. Trump’s tariff will continue.
Historically, drugs have been avoided from customs tariffs under the World Trade Organization agreement aimed at ensuring access to biological drugs.
Medicines were often exempted from the global tariffs that Mr. Trump announced earlier this month, then partially delayed 90 days. The drug makers who import from China to the United States were initially subjected to 10 percent, then 20 percent, which Mr. Trump imposed on Chinese imports earlier this year.
Anna Swanson The reports contributed.