Some two weeks after the public comment period closed for the Trump administration’s Section 232 investigation into the national security implications of pharmaceutical imports, a wide range of drugmakers, trade groups and foreign governments have largely aligned in opposition to potential industry-specific tariffs.
The responses touched on several common themes, including the inherent interconnectivity of the modern biopharma industry and the necessity of working with trusted trade partners. Commenters also highlighted the lengthy timelines and steep costs of U.S. reshoring and the potential for President Donald Trump’s proposed pharmaceutical tariffs to violate policies under the World Trade Organization.
Many groups, companies and individuals submitted insights ahead of the May 7 deadline to comment on the investigation, which the administration launched April 1.
Notably, the U.S.’ two primary biopharma trade groups—the Pharmaceutical Research and Manufacturers of America (PhRMA) and the Biotechnology Innovation Organization (BIO)—both hit back at the prospect of import duties, instead proposing a more tailored probe of imports from adversarial countries and partnership-driven strategies, respectively.
Meanwhile, governments from key industry suppliers, including China, the EU and Korea, as well as representatives from range of large drugmakers like Novo Nordisk, Pfizer, Samsung Biologics, Teva Pharmaceutical and Gilead Sciences, also chimed in.
The lobbying perspective
The U.S.’ innovative pharmaceutical supply chain is both “resilient and secure,” thanks in large part to a healthy mix of domestic manufacturing and “reliable U.S. allies,” PhRMA said in its comment.
“While the innovative biopharmaceutical industry certainly faces trade barriers in multiple markets, those barriers are best addressed through negotiation and enforcement of robust bilateral and sectoral agreements,” the organization said.
As opposed to other industries that have been subject to Section 232 investigations in the past, the innovative drug industry is “healthy and competitive,” PhRMA said, noting that almost two-thirds of the value of drugs consumed in the U.S. are made in the U.S.
Still, PhRMA wasn’t totally opposed to a national security investigation of drug imports, arguing that the Trump administration should narrow its focus to instances in which the U.S. over-relies on supply for essential medicines and active pharmaceutical ingredients from “adversarial countries.”
“Building on this work, [the Department of Commerce] should work with industry to identify a refined and targeted list of those products on which the United States is overly reliant on supply of these essential medicines and APIs from adversarial countries,” PhRMA said.
BIO, with members including many U.S.-based biotechs, largely shared PhRMA’s perspective, noting that biotechnology is “indispensable to national security” while cautioning that the U.S.’ current leadership position in the field “is not guaranteed.”
“Without targeted action, the U.S. risks falling behind as geopolitical competitors make aggressive investments in biotechnology and biomanufacturing to challenge U.S. dominance in the global bioeconomy,” the trade group contended.
Much of BIO’s commentary focused on the logistics of reshoring manufacturing to U.S. soil, which is pricey and often takes at least five to 10 years to establish. An “immediate” reshoring push risks disrupting access to medicines and stymying R&D activities, BIO warned.
“Instead of encouraging domestic investment, tariffs would raise production costs, delay expansion efforts, and place disproportionate pressure on small and emerging biotech companies that drive innovation,” the organization said. Unlike larger, commercial pharma companies, small or emerging biotechs simply won’t be able to absorb the costs that would accompany potential tariffs, BIO added.
BIO is urging the Trump administration to instead pursue a “proactive, partnership-driven strategy” to boost U.S. resilience, such as a public-private biomanufacturing consortium, which the group argues “could provide the structure needed to align industry expertise with national policy goals and ensure that incentives and programs are targeted for maximum impact.”
BIO also called for the implementation of more competitive tax policies plus expanded global trade cooperation, domestic workforce development and less burdensome regulatory pathways for drug developers, among other measures.
Governments chime in
Beyond the industry itself, several governments that depend heavily on their local biopharma fields raised serious concern about the potential for restrictive U.S. trade policies.
“The proliferation of such investigations and possible actions under the guise of national security to protect certain industrial sectors against foreign competition is of great concern to the EU,” the EU said in its prepared comments.
The EU highlighted its longstanding national security partnership with the U.S. and said it rejects the notion that European biopharma exports pose any threat to its ally.
“On the contrary, the EU and the U.S. are significant and reliable trade partners to each other for pharmaceuticals, inputs and derivatives,” the EU said in its comment. “Maintaining a reliable and open trade relationship on these products is crucial to ensure a stable, secure and diversified supply to both U.S. and EU pharmaceutical industries and U.S. and EU patients and healthcare systems.”
In seeking to highlight how interconnected to two territories’ industries are, the EU pointed out that 38% of all EU pharmaceutical exports are sent to the U.S. At the same time, the EU supplies around 61% of the U.S.’ pharmaceutical import needs. The bloc says it primarily exports blood-based products, packaged medicines and chemical compounds, as well as certain drug ingredients, to the U.S.
Meanwhile, in a common refrain among commenting governments, the EU noted that potential U.S. tariffs could run afoul of prior trade agreements.
Both the U.S. and the EU participate in the 1994 Agreement on Trade in Pharmaceutical Products, which eliminates tariffs and other duties on a significant number of pharmaceutical products and active pharmaceutical ingredients, the EU pointed out.
The EU also questioned whether the Trump administration’s national security justification for its potential tariffs meets the standards of the World Trade Organization’s General Agreement on Tariffs and Trade, which enables the use of trade defenses in response to foreign competition, but only under very specific circumstances.
China—which has taken the brunt of the Trump administration’s trade ire thus far—was even more direct in its admonition of potential U.S. pharmaceutical import tariffs and the thought process that fed into the president’s Section 232 investigation.
In its comment, the Chinese government asserted that “since 2017, the U.S. has continuously extended the concept of ‘national security,’ using it as a pretext to launch Section 232 investigations to impose trade protectionist measures such as additional tariffs on imported products of steel, aluminum, automobiles and automobile parts, etc.”
China took issue with the fact that the Commerce Department solicited comments “without even announcing the initiation of the Section 232 investigations.”
China contends the move is “inconsistent with the due process and is also detrimental to the credibility and transparency of the government action.”
The China Chamber of Commerce for Import & Export of Medicines & Health Products (CCCMHPIE) submitted its own comment, providing additional insight on the interdependence of the U.S. and Chinese drug industries.
“The U.S. pharmaceutical industry focuses on innovation, specializing in R&D, production, and global market expansion of novel drugs – positioning itself at the high-value end of the supply chain,” the CCCMHPIE said. “China, on the other hand, excels in manufacturing, particularly in pharmaceutical ingredients production, generic drug manufacturing, and large-scale pharmaceutical production, providing critical support to U.S. drugmakers.”
Where the tariff threat stands
Tariffs have played a key role in the Trump administration’s trade policy so far. Although the threat of pharmaceutical-specific duties has persisted, trade penalties on drugs and related products were notably exempt from Trump’s “Liberation Day” reciprocal tariff reveal in early April.
Nevertheless, the administration kicked off its 232 investigation into pharmaceutical imports that same month. The probe, enabled by the Trade Expansion Act of 1962, empowers the president to explore the effects of certain imports on U.S. national security. If a threat is found, the president can then impose trade restrictions, like tariffs, among other measures.
Many of the comments on the investigation were made public Wednesday, the same day that the U.S. Court of International Trade voided Trump’s fentanyl-related tariffs on China, Mexico and Canada, as well as the sweeping reciprocal tariffs that have largely been paused since April. The court specifically ruled that Trump lacked the authority to impose mass tariffs under the International Emergency Economic Powers Act of 1977, also known as the IEEPA, according to The Wall Street Journal.
Still, trade duties on specific products like steel and aluminum, and those planned for industries like lumber and semiconductors, are still in play, as they’re covered by a separate law, the WSJ pointed out. That would in turn suggest that the administration’s pharmaceutical import investigation could still result in industry-specific duties in the future.