The White House recently imposed sweeping new tariffs on a wide variety of imported goods.
The good news for patients is that pharmaceutical products are not subject to these so-called “reciprocal tariffs” — for now. But that soon may change, as President Donald Trump has suggested that we’ll still see pharma-specific tariffs “at some point.”
Trump seems to expect this threat will force companies to move pharmaceutical manufacturing to the U.S. overnight. But in reality, upending longstanding global supply chains to shift manufacturing for even one product is a long-term, costly endeavor. It’s one that also requires a well-staffed and resourced FDA to authorize each aspect of tech transfer and manufacturing scale-up.
With the continued cuts at the FDA and a larger brain drain expected to come, manufacturers are rightly concerned that the typical five-year timeline for building and operating new manufacturing sites would become even longer. Timelines for the review and approval of new medicines, including generics, will also likely be negatively impacted by the cuts and other changes at the FDA.
Tariffs won’t ensure America remains the most attractive place in the world to make the lengthy and costly investments to research, develop, and manufacture new treatments and cures. They’ll simply lead to higher costs for patients, reduced access to new medicines, and drug shortages — particularly for generic medicines.
Biotech supply chains are extraordinarily complex, and American drugmakers won’t be able to easily adapt and find domestic suppliers. It can take a decade and more than $2 billion to build a life sciences production facility in America. By making it more expensive and logistically challenging to manufacture medicines here, any tariffs on pharmaceuticals or any pharmaceutical ingredients could lead to layoffs of high-wage workers, production slowdowns, and increased risk for drug shortages as manufacturers seek alternative suppliers to the greatest extent possible.
Some manufacturers could be forced to exit the market entirely, exacerbating drug shortages. Even if substitutes can be found, the need for authorization from a now more-limited FDA would impact the production timelines. Changing out even one pharmaceutical supplier isn’t like swapping out a vendor in other sectors — it’s a highly regulated, lengthy process in which any vendor must meet significant technical and quality requirements. In the short term, patients would bear the brunt of these disruptions through limited drug availability and delays in access to new and potentially existing treatments.
Taxing medicines is a mistake — for patients, for workers, and for the future of American manufacturing. If the administration wants to grow U.S. manufacturing, it should preserve the longstanding tariff exemption for drugs and their ingredients, ensure a well-staffed and resourced FDA, repeal the drug price controls in the Inflation Reduction Act, and reverse policies that have weakened intellectual property protections that are key to incentivizing U.S. R&D and manufacturing investments. Even during times of heightened trade tensions, the leading members of the World Trade Organization — including the first Trump administration — have maintained a “zero-for-zero” initiative when it comes to drug tariffs.
Imposing tariffs on medicines and their ingredients won’t make America stronger. It will only disrupt American supply chains, increase the risk of drug shortages, and raise costs for patients while limiting their access to medicines.
Anne Pritchett, Ph.D., is a senior associate at the Center for Strategic and International Studies (CSIS) Renewing American Innovation Project and the founder of Pritchett Policy Associates.
