Pharma Data Privacy and Cybersecurity under the Trump Administration
Introduction
At first glance, the Trump administration’s approach to the pharmaceutical industry appears largely deregulatory. From a data privacy and security perspective, however, the reality is more complex. Rather than eliminating compliance obligations, current policy trends suggest a reshuffling of them.
The administration has signaled a more innovation-friendly posture on artificial intelligence and certain health IT rules while at the same time preserving — and in some cases, strengthening — cybersecurity expectations for health care-related entities and tightening national-security controls on sensitive health and genomics data moving across borders.
For pharmaceutical companies, this means privacy risk is increasingly shaped by cybersecurity governance, vendor management, digital marketing practices, and geopolitical data controls rather than a single sweeping privacy statute.
HIPAA Modernization
One of the most important developments is the federal government’s effort to modernize the HIPAA Security Rule. The Department of Health & Human Services has proposed significant updates designed to reflect today’s cybersecurity threat environment. If finalized in something close to its current form, the rule would represent one of the most consequential federal health care cybersecurity updates in many years.
The proposed changes would require more specific and demonstrable safeguards, including comprehensive technology asset inventories, network maps, detailed written risk analyses, stronger encryption expectations, multifactor authentication in key contexts, periodic vulnerability scanning, annual penetration testing, and formal disaster-recovery capabilities capable of restoring critical systems and data within defined timeframes. In effect, the federal baseline would move closer to what most cybersecurity professionals already consider modern cyber hygiene.
These developments matter to pharmaceutical companies even when a manufacturer is not itself a classic HIPAA-covered entity. The HIPAA framework formally applies to health plans, health care clearinghouses, and certain health care providers. However, the modern pharmaceutical ecosystem increasingly operates adjacent to regulated health care workflows. Patient support programs, specialty pharmacy relationships, digital therapeutics, connected medical devices, and patient engagement platforms frequently involve the movement of patient information through multiple entities. As a result, pharmaceutical companies often interact with HIPAA-regulated partners or business associates even when they are not directly regulated themselves. Moreover, where HIPAA does not apply, other regulators may still assert authority over the collection and use of health-related information.
The practical result is a fragmented but real compliance environment in which some pharmaceutical data falls within HIPAA, some falls outside it, and all of it can create meaningful regulatory and reputational risk if governance is weak.
Enforcement Trends
Enforcement trends reinforce this reality. Federal regulators have increasingly emphasized that foundational cybersecurity practices are no longer optional. Investigations have frequently focused on whether organizations performed thorough risk analyses, implemented reasonable risk-management measures, and maintained adequate system monitoring and oversight. Many enforcement actions continue to involve ransomware attacks, phishing incidents, or exposed databases that could have been mitigated through basic controls such as multifactor authentication, vulnerability management, and documented incident-response procedures. For pharmaceutical companies that operate patient support hubs, digital health platforms, or health care-facing affiliates, these enforcement signals underscore the importance of demonstrable cybersecurity governance. Regulators increasingly expect documented security programs rather than general assurances that security is taken seriously.
Online Tracking Technologies
Another area receiving increasing attention is the use of online tracking technologies in health care-related websites and mobile applications. Government guidance has emphasized that tracking tools — such as analytics pixels, software development kits, and similar technologies — can create compliance issues when they transmit information about users to third-party vendors in ways that reveal sensitive health-related information. Pharmaceutical companies often operate disease awareness websites, reimbursement support tools, adherence applications, and patient engagement portals. These platforms can generate data that indirectly reveals a patient’s health condition, treatment interest, or medication use. Under the current regulatory environment, companies must approach these digital tools with a strong “privacy by design” mindset. That includes mapping data flows, carefully evaluating third-party analytics vendors, restricting unnecessary data collection, and ensuring contractual safeguards are in place when vendors process potentially sensitive information.
Cross-Border Data Transfers and National Security
A potentially even more significant development lies outside traditional health care regulation. Recent federal initiatives aimed at protecting sensitive American data from foreign adversaries have placed new restrictions on certain cross-border data transfers. These programs limit or prohibit transactions that provide countries of concern or certain foreign persons with access to large volumes of sensitive personal information or government-related data. Importantly for the life sciences sector, the definition of sensitive data includes categories highly relevant to pharmaceutical and biotechnology companies, such as human genomic data and other biological or health-related datasets. The scope of these rules extends beyond hospitals and clinical providers. It may encompass pharmaceutical research datasets, genetic testing data, medication-usage data, and health information collected through digital platforms or applications.
For pharmaceutical companies engaged in global research collaboration, cloud computing, or data analytics partnerships, these national-security restrictions create a new layer of governance. Data sharing arrangements that previously were viewed primarily through a privacy or intellectual-property lens may now require national-security analysis as well. Companies must consider where sensitive research data is stored, who has access to it, and whether international collaborators or service providers fall within restricted categories. These considerations are particularly relevant for organizations conducting genomic research, precision medicine initiatives, or large-scale patient-data analytics.
Regulatory Oversight
Federal policymakers have attempted to balance these restrictions with the practical needs of drug development and medical research. Certain exemptions exist for activities related to regulatory approval, clinical investigations conducted under applicable regulatory frameworks, and other activities necessary for pharmaceutical innovation. However, these exemptions often require safeguards such as de-identification, pseudonymization, and strict limitations on the scope of shared data. In many cases, organizations must maintain records demonstrating that the exemption applies and that appropriate safeguards were implemented. As a result, cross-border research governance is quickly becoming a board-level issue for life sciences companies.
Artificial Intelligence
At the same time, the Trump administration has signaled a more permissive stance toward artificial intelligence and certain health IT regulations. Federal policymakers have emphasized the importance of maintaining American leadership in artificial intelligence and reducing regulatory barriers that might slow innovation. Proposed changes in federal health IT rules have similarly focused on increasing flexibility and reducing compliance burdens that might impede technological development.
Consequences for Pharma Businesses
For the pharmaceutical sector, this Administration’s policy direction creates both opportunity and responsibility. AI technologies are increasingly being deployed in drug discovery, clinical trial design, pharmacovigilance, regulatory documentation, and patient engagement. A lighter federal regulatory posture may accelerate experimentation and adoption of these tools. However, the absence of detailed regulatory guardrails means that companies must rely heavily on their own internal governance frameworks. Organizations deploying AI systems that process health or research data must ensure appropriate controls around data provenance, model access, human oversight, bias mitigation, and vendor diligence.
Ultimately, the Trump administration’s impact on pharmaceutical privacy and cybersecurity is more nuanced than the simple label of deregulation suggests. The likely outcome is not less compliance, but different compliance. Pharmaceutical companies will face increasing expectations around cybersecurity resilience, heightened scrutiny of cross-border data transfers, and growing risk associated with digital patient engagement platforms. At the same time, they may experience greater flexibility in developing AI-driven technologies and health-data innovation.
What Companies Can Do Now
The companies best positioned to succeed in this environment will be those that treat privacy and cybersecurity as core elements of enterprise risk management rather than as narrow legal compliance obligations. Companies will be well-served by identifying their potential areas of risk now and crafting plans to protect their data.
Companies should also evaluate the positioning of current governance structures to address these risks. Effective governance will require coordination across legal, information security, research, regulatory affairs, and executive leadership. In a regulatory environment where the most important rules increasingly come from multiple directions — health care regulation, cybersecurity enforcement, and national-security policy — the most resilient organizations will be those capable of adapting quickly while maintaining strong data governance foundations.
For additional resources on the Trump Administration’s impact on the pharmaceutical industry, visit Foley’s Trump Administration Resource Hub.
Foley is here to help you address the short- and long-term impacts in the wake of regulatory changes. We have the resources to help you navigate these and other important legal considerations related to business operations and industry-specific issues. Please reach out to the authors, your Foley relationship partner, our Health Care & Life Sciences Sector, or to our Innovative Technology Sector with any questions.
