Foley & Lardner LLP partner Kyle Faget assessed the Trump administration’s implementation of import tariffs on the pharmaceutical industry in the Pharma Life Sciences article, “Trump’s pharma import tariffs threaten drug pricing, generics.”
“The cost of medication will rise in the face of tariffs, especially for medications whose manufacturing largely occurs overseas,” Faget said. She pointed out the significant investment needed to build up a domestic pharmaceutical manufacturing base. “The money to support a manufacturing build-out in the U.S. has to come from somewhere, so drug prices will increase.”
Faget identified generic manufacturers as particularly vulnerable under the proposed tariff structure. “These low-margin products truly depend on the cost benefits associated with manufacturing in other countries,” she commented. “I foresee generic drugs being impacted the most if the tariffs are put in place.”
With budget adjustments needed to handle increased infrastructure and compliance costs, Faget noted that research and development investments may be cut as domestic capacity building takes priority.
“It may be that other programs will suffer during the transition,” she added. “I would not be surprised to see less investment in research and development while this process unfolds.”
