Trump 200 % tariffs threaten to raise drug prices and strike margins

The pharmaceutical industry is scrambling with scenario planning, as it threatens to propose a 200 % tariff tariff by Donald Trump by raising drug prices and distributing corporate profit margins.

President Be careful On Tuesday, the long -awaited definitions will be announced at the industry level “Very soon” After the administration launched the so -called 232 investigation In the sector in April.

Trump suggested that these fees will not enter into force immediately, but obtaining a permissible period “about a year, one and a half to a year.”

However, analysts warn that such a rate – even with the delay – will have a harmful effect on drug prices and profit margins.

Barclays wrote in a memo on Wednesday: “The customs tariffs of 200 % amplify the costs of production, the pressure of profit margins, and the disruption of the supply chain of risk, which leads to a lack of drugs and the high prices of consumer in the United States,” Barclays wrote in a memorandum on Wednesday.

UBS analysts have mentioned “a large negative effect” on the margins, where goods are made outside the United States, and at the same time, the blow to patients can be “catastrophic”.

“It is likely that this is catastrophic for everyone because we need these medications, and it takes a long time to produce them here in the United States,”

It is estimated that a tariff of only 25 % on pharmaceutical imports will lead to an increase in the prices of drugs in the United States by about $ 51 billion annually, which increases local prices by up to 12.9 % if passed, according to Pharmaceutical Research for Research and Manufacturers in America (PHRMA), which on Wednesday embraced the president’s proposals as “opposite results” of health results.

In response, international pharmaceutical companies – including Novartisand Sanovi and Rush It is based in the United States Eli Lily and Johnson and Johnson I pledged obligations to invest large sums in the United States

UBS called UBS is called the administration’s grace period from 12 to 18 months as a “insufficient time” for companies to transport in the United States.

“We usually think about 4 to 5 years as a timetable to transfer the manufacture of commercial scope to a new site,” analysts wrote.

The industry is now waiting for more details at the end of this month, when the investigation report in the final 232 section is worthy. But in the meantime, companies have no choice but to plan different possible results.

A spokesman for Roche said that the company “monitors the situation closely” and participates with the stakeholders “to defend the policies that address the barriers that prevent the patient’s arrival” and create “a more fair environmental system at reasonable prices.”

The Swiss pharmaceutical giant said that the issue of drug pricing in Trump could endanger its investments in the United States. However, on Wednesday noticed that her proposed financing would allow her to continue building the manufacturing fingerprint in the United States

Bayer said like that he was watching “different tariffs” and that he focused on securing their supply chains and “reducing any possible effect.”

Meanwhile, Novartis said that she continues to work with the partners of the American Administration and Trade Association, and that he “has no changes” to its planned investments.

Astrazneca and Sanofi did not immediately respond to the CNBC request for comment, while Novo Nordisk refused to comment during a quiet period before the profits.

The pharmaceutical industry had sought before Bus at the sector level From definitions. But as these hopes fade, attention now turns into potential commercial deals as a possible temporary store.

The commercial deal of the United States of America was announced last month, while separating, States Both sides will negotiate “the results of the preferential treatment of pharmaceutical preparations in the United Kingdom and the pharmaceutical components that depend on the results of the investigation in section 232.”

Pharmaceutical companies in Switzerland and the European Union can aim at similar points in their potential deals. However, without clarity soon, the question marks remain for companies and consumers.

“The longer the duration of the uncertainty that will be affected by the sectors, which will not have a continuous negative impact,” said Bert Colegen, the chief economist in Eng.