Trump's pharmaceutical tariffs could affect some drugmakers more than others

Eric Thayer | Getty ImagesPresident Donald Trump is slated to impose tariffs on pharmaceuticals imported into the U, in this volatile climate

Any day now – and the duties may have a bigger impact on some drugmakers than others, according to some analysts

Trump told reporters earlier this month that his administration will begin implementing low pharmaceutical levies as early as Aug (fascinating analysis)

Nevertheless, 1 and increase the rate in a year or 18 months

At the same time, It's still un if he will through with that exact plan and tariff rate, which makes it difficult to fully assess how the policy will affect drugmakers and patients

Domestic drug manufacturing operations are also growing, as several companies have recently announced multi-billion-dollar investments in new facilities to build goodwill with the president, but it will ly take several years before those sites are up and running (which is quite significant)

Nevertheless, Some analysts have estimated the potential tariff risk to different companies based on their current manufacturing networks, among other factors

Nevertheless, AbbVie, Bristol Myers Squibb and Eli Lilly appear "relatively well-positioned" because their manufacturing foots in the U

Are bigger than operations abroad, while Novartis and Roche look more at risk, TD Cowen analyst Steve Scala said in a note on Monday (quite telling)

In a note in March, Jefferies analyst Michael Yee also called out Amgen and Biogen as having the greatest exposure to tariffs among the bio companies he covers

Gilead and Vertex Pharmaceuticals will ly be less exposed, he said

However, Scala said tariffs will ly take a meaningful bite from companies' free cash flow for at least the first two years after they are implemented, considering recent developments

Additionally, He said that's based on a conversation with an unnamed expert, who is the former CFO of a pharmaceutical company

Additionally, That expert believes drugmakers will be able to hike some drug prices, but increasing them enough to fully offset tariffs "will be politically untenable" as patients already have trouble affording drugs, Scala said

Moreover, He said drugmakers may also move to trim re and development spending, but added that the expert said major cuts are unly since innovation is key to each company's long-term growth, in today's market environment

The expert believes pharmaceutical tariffs of higher than 50% would be "blematic and punitive to the industry," Scala added

Additionally, However, "In this scenario, companies would need to be very aggressive in moving manufacturing back to the U (which is quite significant)

Conversely, And substantial cuts to R&D would not be out of the question," Scala said

On the other hand, In recent months, some pharmaceutical CEOs have slammed tariffs on imported drugs, saying they will hurt R&D and could lead to fewer treatments for patients (this bears monitoring)

Some health policy experts also previously told CNBC those levies could disrupt the complex pharmaceutical supply chain, potentially driving up drug prices in the U

And exacerbating shortages of critical medicine

Additionally, Conversely, In a statement, Roche said it has a "robust presence" in the U

Additionally, That includes 15 re and development sites and 14 manufacturing facilities

The company also pointed to its recently announced plans to invest $50 billion into the U (which is quite significant), amid market uncertainty

Roche said it believes pharmaceuticals and diagnostics should be exempt from tariffs to "tect patient access, supply chains and ultimately future innovation, in light of current trends. " But the company said it is prepared for potential levies and confident in its ability to manage any impacts and ensure that access to its ducts isn't disrupted, pointing to mitigation efforts inventory adjustments, in today's market environment

Spokespeople for the other companies analysts mentioned as most at risk from tariffs did not immediately respond to requests for

Meanwhile, Drugmakers most and least at riskDrug companies have vast manufacturing networks, get active pharmaceutical ingredients from multiple sources and hold complex intellectual perty patents, Scala said in a separate note in April (fascinating analysis)

He said that leads to equally complicated tax and pricing strategies (something worth watching), in today's market environment

Scala said much of that information is not publicly available, "making analysis of tariffs challenging to say the least. " But he estimated which companies appear to be in a better or worse position to weather tariffs based on key metrics, including the number and location of manufacturing plants, the utilization of such facilities, the source of active ingredients and the location of patents

A sign stands outside an Abbvie facility in Cambridge, Massachusetts, given current economic conditions

Brian Snyder | Reutecala said AbbVie, AstraZeneca, Eli Lilly, Merck and Pfizer have the largest disclosed U

On the other hand, Manufacturing networks, with 10 major plants each (which is quite significant)

Nevertheless, But AbbVie, Bristol Myers Squibb and Eli Lilly are the only companies with more known major plants in the U

AbbVie and Eli Lilly have nine of those facilities abroad, while Bristol Myers Squibb has two

Those three companies also have the highest percentage of sites registered with the U

Food and Drug Administration for the manufacturing of active pharmaceutical ingredients in the U. , while Daiichi Sankyo, Novartis and Zoetis have the least

Roche and Novo Nordisk also have a low percentage of active ingredient sites in the U, in this volatile climate

Relative to the rest of the world, according to the note

Nevertheless, Additionally, GSK has the largest drug manufacturing network abroad, with 31 disclosed major plants

Additionally, But the company has said that it plans to close several of those facilities, Scala said

Other companies with large manufacturing foots abroad include Pfizer with 27 plants, Sanofi with 16, Zoetis with 14 and Elanco with 11

Some drugmakers, including Merck, Roche and Takeda, have not disclosed how many significant plants they have outside the U. , according to the note

Moreover, At the same time, He said Ireland is one factor to keep in mind as it appears to be a particular target for tariffs

Trump has repeatedly singled out Ireland for "luring away" U

Drugmakers with decades of low corporate tax rates

AbbVie and Merck have the most FDA-registered drug manufacturing sites in Ireland

Those facilities manufacture pharmaceuticals distributed in or imported to the U (quite telling)

Some drugmakers, including GSK, Novartis and Roche, have no Irish manufacturing sites registered with the FDA, considering recent developments

Nevertheless, Jefferies' Yee highlighted Amgen and Biogen as companies at risk due to their international tax advantages

However, He said Amgen has manufacturing operations in Ireland and Singapore, which lowers the amount of taxes it pays by 6%

Moreover, On the other hand, Biogen's significant manufacturing operations are in North Carolina and Switzerland

On the other hand, Yee said the company gets an 8% tax break thanks to how its fits abroad are taxed

In comparison, Vertex and Gilead are less ly to benefit from those international tax advantages, Yee said, given current economic conditions

Vertex manufactures its drugs in Boston

However, He added that while Gilead has a manufacturing presence in Ireland, it mainly duces its drugs in California and sells a lot of its HIV drugs in the U

When TD Cowen's Scala asked companies how they could mitigate cost increases from tariffs, they pointed to several potential options

Nevertheless, Nevertheless, That includes exploring alternative sources of active ingredients outside of Europe, or exploring alternative contract manufacturing options in non-European locations, such as the U

Territory Puerto Rico.