Report: Trump plans to impose a 100% tariff on certain pharmaceuticals, announcement as early as Thursday

Report: Trump plans to impose a 100% tariff on certain pharmaceuticals, announcement as early as Thursday

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The Trump administration is accelerating the imposition of 100% tariffs on some imported pharmaceuticals, targeting drug companies that have not yet reached agreements with the White House. The aim is to use high tariffs as leverage to force multinational pharmaceutical companies to relocate production lines back to the United States.

According to the latest media reports, the relevant tariffs may be officially announced as early as this Thursday. The new tariffs will apply to companies that have not signed investment or price reduction agreements with the White House; companies that have reached agreements can enjoy exemption status or capped tariff rates.

Pfizer, AstraZeneca, and Novo Nordisk have secured tariff exemptions by promising increased investment in the US as well as price reductions. In the agreement reached in Turnberry, Scotland, the EU’s pharmaceutical tariff cap was locked at 15%; the UK also obtained a three-year tariff preference on the condition that NHS pharmaceutical procurement spending is increased.

For pharmaceutical companies that have not completed negotiations, the 100% tariff will result in significant cost impacts and may accelerate their reassessment of US manufacturing and production layout decisions. This tariff is based on a Section 232 national security investigation, which has independent and solid legal grounds, unaffected by the Supreme Court ruling made this February.

This pharmaceutical tariff originated from a national security investigation launched in April 2024 under Section 232 of the 1962 Trade Expansion Act.

This legal framework provides independent authorization for the relevant tariffs, entirely different in legal nature from the emergency powers tariffs previously invoked by Trump.

In February of this year, the US Supreme Court ruled that Trump’s emergency tariffs were invalid.

However, tariffs based on Section 232 are not bound by that ruling and can proceed smoothly at the legal level. According to reports, the White House has since launched several new investigations, using different legal authorizations to rebuild the previously overturned tariff system.

Exemption Mechanism: Agreement Holders Protected, Negotiation Pressure Transmitted to Non-Participants

Countries and companies that have reached agreements with the White House will receive exemption protection. This mechanism forms the core bargaining lever of the current tariff policy, while clearly delineating the boundaries of market differentiation.

At the national level, the EU, under the Turnberry agreement, capped pharmaceutical tariffs at 15%; the UK obtained three years of tariff preference in exchange for a commitment to increase NHS drug spending.

At the company level, Pfizer, AstraZeneca, and Novo Nordisk have completed negotiations with the Trump administration, securing exemption by pledging increased US investment and price reductions.

For pharmaceutical firms not yet in negotiations, having to accept a 100% tariff or fast-track talks will be a difficult choice they must face.

High Tariffs as Leverage to Promote Industry Return to the US

As early as last autumn, Trump publicly stated that if branded or patented drug manufacturers did not build production facilities in the US, their imported products would face a 100% tariff. This week’s announcement is the formal implementation of that threat.

The policy aims to use high tariffs to create cost pressures, pushing multinational pharma companies to build factories in the US or reduce prices in exchange for market access.

Major firms like Pfizer and AstraZeneca, which have completed negotiations, offer ready-made templates for other companies—investment commitments plus price reductions are currently the main paths to exemption.

For manufacturers from major pharmaceutical exporting countries like Ireland, Germany, and India, these tariffs will significantly increase operational uncertainty, and relevant companies face urgent pressure to reassess their US export strategies and supply chain layouts.

While exerting pressure on the pharmaceutical industry, the Trump administration is also planning major adjustments to the steel and aluminum tariff system, imposing a unified 25% tariff on "derivative products" containing steel and aluminum to replace the current complicated and labor-intensive taxation method.

According to US media, the new steel and aluminum tariff policy may be announced as soon as this week. The new policy will stipulate that finished products made with imported steel and aluminum will be subject to a 25% tariff across the board. The current policy requires companies to calculate their tax burden based on the steel and aluminum content in their products, with the maximum tariff rate reaching 50%.

Analysts believe this tariff adjustment is more of a “technical optimization” of existing trade protection policies, rather than a directional shift. The US still seeks to protect domestic industries through tariffs, but is transitioning toward frameworks that are “more operable and more certain” at the implementation level.

 

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