President Trump’s overnight decision to impose a 100% tariff on imported pharmaceuticals starting Oct. 1 is already whacking the stock prices of foreign drug companies as analysts struggle to digest how damaging the hit to the drug business will be.
“Starting October 1st, 2025, we will be imposing a 100% Tariff on any branded or patented Pharmaceutical Product, unless a Company IS BUILDING their Pharmaceutical Manufacturing Plant in America,” the president said on social media. “‘IS BUILDING’ will be defined as, ‘breaking ground’ and/or ‘under construction.’ There will, therefore, be no Tariff on these Pharmaceutical Products if construction has started.”
The bad news: The drug tariffs will be “a meaningful commercial hit for U.S. consumers,” according to Oxford Economics’ analyst Louise Loo. Exporters in China, Vietnam, and Malaysia will also be affected by a separate Section 232 probe that Trump ordered into whether the medical products they supply represent a national security vulnerability.
The good news: There are several loopholes in Trump’s proposal that mean the impact of the new taxes may be limited.
This morning, Asian drug companies saw their market caps trimmed as traders bailed out of foreign pharma stocks.
