President Donald Trump on Tuesday (Apr 8) said the United States will soon announce a “major” tariff on pharmaceutical imports.
Speaking at an event at the National Republican Congressional Committee, Trump said the tariff will incentivise drug companies to move their operations to the US.
Pharmaceuticals were exempt from sweeping tariffs on US imports announced by Trump last week but he has said they will face separate tariffs.
European pharma companies, fearful of the tariff fallout, warned the European Commission at a meeting on Tuesday Trump’s tariffs would expedite the industry’s shift away from Europe and toward the US.
Pharma trade lobby EFPIA, whose members include European pharma giants Bayer, Novartis and Novo Nordisk, said it had called on EU President Ursula von der Leyen to push for “rapid and radical action” to mitigate the “risk of exodus” to the US.
EFPIA said the EU needs to change its regulatory framework for the industry to make it more conducive to innovation and strengthen Europe’s intellectual property provisions.
The demands were not new. EFPIA has repeatedly warned that Europe’s pharma sector will lose out to increased competition from the US, China and emerging markets if the EU does not amend a proposed revamp of laws governing the sector.
“Now with the uncertainty created by the threat of tariffs, there is little incentive to invest in the EU and significant drivers to relocate to the US,” the EFPIA statement read.
A statement from the commission said Novo Nordisk, Novartis, Fresenius, Sanofi, Bayer, Gedeon Richter and Ipsen Chiesi attended the call.
Further, the statement said the industry raised “strong concerns” about the wider impact of US tariffs on global supply chains and medicine availabilities in Europe as well as regulatory barriers within the EU.
The industry also pushed for simpler “procedures for clinical trials and digitalisation of the European health system, as well as for protection of intellectual property.
“They urged ambition and speed with upcoming initiatives ... notably the EU Biotech Act,” the statement added.
Biotech lobby Europabio, the European Confederation of Pharmaceutical Entrepreneurs and generics trade group Medicines for Europe also attended the meeting.
Europe and the US have interconnected supply chains for medicines. The US depends on medicines partly produced in Europe that bring in hundreds of billions of dollars in revenue.
EU medical and pharmaceutical product exports to the US totalled about 90 billion euros (US$97.05 billion) in 2023, according to the latest Eurostat data.
European pharma giants have recently been expanding production facilities in the US. The US is the biggest pharma market by sales for big pharma companies, both US and European headquartered ones.
Sales in North America accounted for nearly 50 per cent of world pharmaceutical sales in 2021, compared with nearly 25 per cent for Europe, according to EFPIA.
Source: Reuters
--Agencies
