·Tariffs and tradeTrump’s overnight demand for 100% tariffs on pharmaceuticals will be ‘a meaningful commercial hit for U.S.
consumers,’ top analyst saysBy Jim EdwardsBy Jim EdwardsExecutive Editor, Global NewsJim EdwardsExecutive Editor, Global NewsJim Edwards is the executive editor for global news at Fortune.
He was previously the editor-in-chief of Insider's news division and the founding editor of Insider UK. His investigative journalism has changed the law in two U.S. federal districts and two states.
The U.S. Supreme Court cited his work on the death penalty in the concurrence to Baze v. Rees, the ruling on whether lethal injection is cruel or unusual.
He also won the Neal award for an investigation of bribes and kickbacks on Madison Avenue.SEE FULL BIO President Donald Trump in the Oval Office of the White House on Sept.
25, 2025.Andrew Harnik—Getty ImagesPresident Trump’s 100% tariff on imported branded pharmaceuticals is expected to hit American consumers and global drug stocks, but there are loopholes: Generic drugs are excluded, and there are exemptions for companies building U.S.
plants. U.S. pharma stocks rose marginally on the news. Asian drug s were hit hardest. President Trump’s overnight decision to impose a 100% tariff on imported pharmaceuticals starting Oct.
1 is already whacking the stock prices of foreign drug companies as analysts struggle to digest how damaging the hit to the drug will be.
“Starting October 1st, 2025, we will be imposing a 100% Tariff on any branded or patented Pharmaceutical duct, unless a Company IS BUILDING their Pharmaceutical Manufacturing Plant in America,” the president said on social media.
“‘IS BUILDING’ will be defined as, ‘ ground’ and/or ‘under construction.’ There will, therefore, be no Tariff on these Pharmaceutical ducts if construction has started.” The bad news: The drug tariffs will be “a meaningful commercial hit for U.S.
consumers,” according to Oxford Economics’ analyst Louise Loo.
Exporters in China, Vietnam, and Malaysia will also be affected by a separate Section 232 be that Trump ordered into whether the medical ducts they supply represent a national security vulnerability.
The good news: There are several loopholes in Trump’s posal that mean the impact of the new taxes may be limited.
This morning, Asian drug companies saw their market caps trimmed as traders bailed out of foreign pharma stocks.
“Investors got a fresh reminder the trade war, and the impact has already been evident in Asian .
For instance, pharmaceutical companies have been among the worst performers this morning in Japan’s Nikkei (-0.46%), with losses for Chugai Pharmaceutical (-5.12%) and Sumitomo Pharma (-5.21%),” Jim Reid and the team at Deutsche Bank told clients today.
In Europe, Denmark’s Novo Nordisk fell 0.43%. Switzerland’s Roche was marginally down.
France’s Sanofi, counterintuitively, was up 0.33% premarket (but that’s bably a dead cat bounce because it lost nearly 3% the day before). In the U.S., by contrast, Pfizer rose 0.64% premarket.
Eli Lilly was up 1.13%. Bristol-Myers Squibb grew 0.65%. On its face, 100% tariffs look harsh. “Asia supplies just over 20% of U.S. pharmaceutical imports by value, a meaningful commercial hit for U.S.
consumers at face value,” Oxford’s Loo wrote. But that implies the White House will be forced to relax some standards, she said. “We therefore expect the U.S.
to up with announcements detailing tections for some of ducts, blunting the effective tariff burden.” The loopholes that will blunt the impact of the new tariffs are: Generic drugs are not included.
Companies that can show an in-gress construction site can be excluded. Companies in Japan and Korea “are effectively shielded by trade-deal safeguards,” Loo added.
UBS’s Paul Donovan said the same: “The 100% pharmaceutical tariff applies only to branded drugs, and constructing a factory may lead to an exemption.
Many pharmaceutical companies have facilities in the U.S., so it may be relatively easy to superficially expand those facilities to avoid tariffs being applied.” In fact, many U.S.
companies may also be shielded. A dozen or more drug companies have mised to spend $350 billion this year in manufacturing and R&D in the U.S., according to the Wall Street Journal.
Nonetheless, Big Pharma is officially unhappy. “[Drug] companies continue to announce hundreds of billions in new U.S.
investments,” a spokesperson for the Pharmaceutical Re and Manufacturers of America told the WSJ.
“Tariffs risk those plans because every dollar spent on tariffs is a dollar that cannot be invested in American manufacturing or the development of future treatments and cures.” Fortune Global Forum returns Oct.
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