Trump’s Trade War: How Drugs are Directly Imported from China and India, and Implications for American Pharmaceutics
The Pharmaceutical Research and Manufacturers of America came out against the executive order after Trump teased the latest price policy on Truth Social Sunday night.
The president signed an executive order asking drugmakers to bring prices in line with those in other countries.
It’s not surprising that giants such as Novartis and Eli Lilly have promised Trump they’ll invest billions in U.S. plants, she said, since much of their final drug product is made here or in Europe, where governments negotiate drug prices. The industry is using Trump’s tariff saber-rattling as leverage; in an April 11 letter, 32 drug companies demanded European governments pay them more or face an exodus to the United States.
The executive order has many parts. It’s not clear if the White House has the authority to take action against foreign policies that lower drug prices. Direct–to-consumer sales are encouraged by the Secretary of Health and Human Services.
“We’ve been subsidizing other countries in the world by paying higher prices,” Trump said at the White House.
In addition to getting cheaper drugs quicker, European countries pay less for brand-name products. Murphy said that countries pay more for generics.
In the basement of a pharmacy in Salt Lake City there are rows of rows of amber colored plastic pill bottles.
Jolley bought six months’ worth of the most expensive large bottles, hoping to shield his business from the 10% across-the-board tariffs on imported goods that President Trump announced April 2. Now with threats of additional tariffs targeting pharmaceuticals, Jolley worries that costs will soar for the medications that will fill those bottles.
Jolley said that using tariffs to push manufacturing from China and India to the U.S. makes sense. In the event of war, China could quickly stop all exports to the United States.
“I understand the rationale for tariffs. I’m not sure that we’re gonna do it the right way,” Jolley said. I am certain that it’s going to raise the price I pay my suppliers.
Squeezed by insurers and middlemen, independent pharmacists such as Jolley find themselves on the front lines of a tariff storm. Nearly everyone down the line — drugmakers, pharmacies, wholesalers and middlemen — opposes most tariffs.
“Big ships don’t change course overnight,” said Robin Feldman, a UC Law San Francisco professor who writes about prescription drug issues. It will take a while to get manufacturing home, even if companies promise to do so. The key will be to avoid damage to industry and pain to consumers in the process.”
“When they hear that, they will leave China,” he said. The U.S. imported $213 billion worth of medicines in 2024 — from China but also India, Europe and other areas.
“I would describe tariffs as uncertain right now,” said Scott, who is a pharmacist and co-owner of the Little Rock, Arkansas, store.
Pharmacists stockpile most common medicines on chance of targeted Trump tariffs: Why U.S. pharmaceuticals are cheaper than China’s chemical factories, and how to protect against new pharmacists
“I’ve identified the top 200 generics in my store, and I have basically put 90 days’ worth of those on the shelf just as a starting point,” he said. The diabetes drugs, the blood pressure medicines, the antibiotics, are things I know people will be sicker without.
Unlike other retailers, pharmacies can’t pass along such costs to patients. Their payments are set by health insurers and pharmacy benefit managers largely owned by insurance conglomerates, who act as middlemen between drug manufacturers and purchasers.
“You’ve got real estate in North Texas that’s cheaper than real estate in Shenzhen,” he said at an economic conference April 25 in Washington, referring to a major Chinese chemical manufacturing center.
He said there is no magic level of tariffs that could make them come into the US. If you lose money on every dose you sell in the US market, then there is no room to make a billion-dollar investment in a domestic facility.
His group is trying to help Trump officials understand the complexity of the problem. “We’re not PhRMA,” Murphy said, referring to the powerful trade group primarily representing makers of brand-name drugs. I can’t travel to Mar-a-Lago to talk to the president on my own.
Tariffs on biosimilars coming from overseas — where Fresenius makes such drugs — would further incentivize U.S. use of more expensive brand-name biologics, the March 11 letter said. Biosimilars, which can cost a tenth of the original drug’s price, launch on average three to four years later in the U.S. than in Canada or Europe.
John Barkett, a member of the White House Domestic Policy Council, said that Europe tends to have more stable contracts with makers of generics than the United States.
Source: Pharmacists stockpile most common drugs on chance of targeted Trump tariffs
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He asked, “How do I solve the problem of caring for my community while not having to worry about the emotional roller coaster that is getting me hundreds of prescriptions a day?”
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