On February 6, U.S. hospitals and generic drugmakers are pressuring the President to exclude medical goods from his tariffs on Chinese imports. They are echoing concerns from big pharma lobbyists about potential medicine shortages and higher prices in the United States.
The President recently imposed 10% tariffs on all Chinese imports, prompting China to retaliate. He has put a hold on 25% tariffs for Mexico and Canada. Discussions with the EU are still pending.
The American Hospital Association has warned that the tariffs will impact vital medications like cancer treatments, heart medicines, and antibiotics sourced from China.
Major trading partners have historically eliminated tariffs for pharmaceutical products and drug production chemicals since 1994.
Various anonymous sources have lobbied for exemptions from the tariffs prior to their announcement.
The hospital lobbying group emphasized the dependency of the U.S. healthcare system on international sources for crucial drug components, such as raw ingredients and medical supplies like face masks and gloves.
The generic medicines lobby group is also seeking exemptions, citing the narrow profit margins of low-cost drug manufacturers and past issues with drug shortages.
U.S. drug imports amounted to over $176 billion in 2023, with about $6 billion from China, including key antibiotics like amoxicillin and penicillin.
While branded drugmakers downplay the impact of the tariffs, European tariffs could significantly affect the global pharmaceutical industry due to their role in producing complex biologic drugs.
The process of shifting drug manufacturing from China to the U.S. or Europe could be lengthy due to regulatory requirements and the time-consuming nature of building new pharmaceutical plants.
Building a compliant pharmaceutical plant in the U.S. can take between five to ten years according to the pharmaceutical lobbying group PhRMA.