Final week, U.S. President Donald Trump disclosed plans for a “main tariff” on overseas prescribed drugs.
BofA Securities analyst mentioned if the Trump administration plans to impose tariffs on the pharmaceutical trade, it might doubtless achieve this by a “Part 232 investigation” beneath the Commerce Growth Act of 1962 to find out whether or not importing sure items threatens nationwide safety.
The U.S. Division of Commerce has launched an investigation into the potential nationwide safety dangers posed by the nation’s reliance on imported prescribed drugs and key drug elements.
The probe, initiated beneath Part 232 of the Commerce Growth Act, will look at the results of those imports on the nation’s capability to supply important medicines and reply to public well being emergencies.
Introduced on April 1, 2025, the investigation will consider a large scope of pharmaceutical imports.
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This consists of completed generic and non-generic drug merchandise, medical countermeasures, energetic pharmaceutical elements (APIs), key beginning supplies (KSMs) and associated spinoff merchandise.
The goal is to evaluate how these imports have an effect on the integrity and resilience of the home pharmaceutical provide chain.
The Bureau of Trade and Safety (BIS) is in search of enter from stakeholders as a part of the investigation.
As per the Federal Register submitting, key points beneath evaluation embody present and future U.S. demand for pharmaceutical merchandise and whether or not home manufacturing capability can meet that demand.
There shall be an examination of the function of overseas provide chains, notably the extent to which U.S. pharmaceutical imports are concentrated amongst a small variety of suppliers and the related dangers of such dependence.
Extra focus areas embody the impression of overseas subsidies and doubtlessly predatory commerce practices on the competitiveness of U.S. pharmaceutical corporations.
The division can also be wanting into issues over artificially suppressed costs because of overseas state-sponsored overproduction and the chance of export restrictions by overseas governments that could possibly be used to leverage geopolitical energy.
The feasibility of increasing home manufacturing capability to cut back reliance on imports and the effectiveness of present commerce insurance policies can even be evaluated.
The investigation might lead to coverage suggestions, together with potential tariffs or quotas, to bolster the nation’s pharmaceutical safety.
“AAM and the generics and biosimilars trade look ahead to working with the Commerce Division and the White Home to have interaction constructively on methods to incent extra home funding within the medicines provide chain,” said John Murphy III, president and CEO of the Affiliation for Accessible Medicines, a commerce affiliation representing the producers and distributors of generic prescribed drugs.
“Tariffs, nonetheless, will solely amplify the issues that exist already within the U.S. marketplace for reasonably priced medicines,” Murphy added.
“With out substantive regulatory and reimbursement adjustments to the U.S. market, tariffs will exacerbate shortages that hinder affected person entry at present,” he continued.
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