Tariffs on pharmaceuticals. First, President Trump has voiced his goal to impose tariffs on pharmaceutical products made overseas. The New York Times reports:
Mr. Trump said in remarks to reporters on Monday that pharmaceutical tariffs would come in the “not too distant future.”
“We don’t make our own drugs anymore,” Mr. Trump said. “The drug companies are in Ireland, and they’re in lots of other places, China.”
While some drugs are made at least in part in the United States, America’s reliance on China for medicines has generated alarm for years, with both Republicans and Democrats identifying it as a national security vulnerability.
Many drugs are not produced without at least one stage of the manufacturing process happening in China. Even India’s giant generic drug sector is deeply dependent on China, because Indian manufacturers typically obtain their raw materials from Chinese plants.
What are the potential implications? Higher prices and shortages:
The raw ingredients of almost all medications are made overseas, even for drugs that are manufactured in the U.S., meaning tariffs could drive up the costs of several medications including over-the-counter painkillers as well as antibiotics, heart medications and asthma drugs.
Pharmacy and economics experts said such tariffs could also lead to drug shortages and could even potentially stall research and development.
Ending the ‘pill penalty’ under IRA. Trump’s executive order would aim to end the difference in negotitation timing between small molecules and biologics. I covered this earlier in the week here.
Potential to increase ex-US drug importation. While on the one hand Trump is proposing to impose tariffs on pharmaceuticals manufactured outside the US, he also called to allow for more drug importation. Specifically, his executive order mandates the Secretary to “streamline and improve the Importation Program under section 804 of the Federal Food, Drug, and Cosmetic Act to make it easier for States to obtain approval without sacrificing safety or quality. “
In other news, attorneys general are calling for Congress to prohibit PBMs from owning affiliated pharmacies.
Certainly a lot going on in the health policy space this week!
