Donald Trump’s threat of placing 25 percent tariffs on all overseas pharmaceutical imports would improve U.S. drug prices by practically $51 billion, a brand new report has discovered.
Costs of treatment and different prices might improve by as a lot as 12.9 p.c if the tariffs, which haven’t but been applied, are put in place.
The findings come from a report commissioned by the pharmaceutical industry’s U.S. trade group, performed by Ernst & Young, and reviewed by Reuters.
The evaluation discovered that in 2023, the U.S. imported $203 billion in pharmaceutical merchandise, 73 p.c of which got here from Europe – primarily from Eire, Switzerland and Germany.
Whole U.S. gross sales of completed pharmaceuticals that 12 months had been $393 billion.
Dated April 22, the report was commissioned by the principle U.S. pharmaceutical foyer, the Pharmaceutical Analysis and Producers of America, whose members embody Amgen, Bristol Myers Squibb, Eli Lilly, and Pfizer, amongst others.
It was not made public.
The report was commissioned after the Trump administration introduced it will examine pharmaceutical imports, citing nationwide safety considerations over reliance on overseas drug manufacturing.
A 21-day public remark interval, throughout which people, organizations, and different events can present enter to assist form the ultimate type of a proposed coverage or regulation, is now underway.
Up to now, pharmaceutical merchandise have been spared from the president’s sweeping international tariffs on overseas merchandise coming into the U.S., although he has threatened to impose the 25 p.c levy a number of occasions.
PhMRA has argued tariffs would undermine efforts to spice up home manufacturing of medication and different prescription drugs, opposite to the president’s goals.
International drugmakers have additionally lobbied Trump, in case tariffs are imposed, to part in levies on imported pharmaceutical merchandise in hopes of lowering the affect of the fees.
It’s unclear to what extent tariffs on imported intermediate inputs or imported completed merchandise could be handed on to shoppers, the report stated.
As well as, roughly 25 p.c of U.S. pharmaceutical merchandise are exported. The whole export prices totalled $101 billion in 2023, in line with EY.
The consultancy agency added {that a} portion of the 490,000 export-related jobs within the business may be in danger if greater enter prices weaken overseas demand for U.S. medicines.
The PhRMA report didn’t embody the affect of attainable retaliatory tariffs. The financial affect on these for U.S. producers could be far more vital, Reuters stories.
Reuters contributed to this report.
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