Just as pharmaceutical tariff uncertainty seemed to be easing in the U.S., the Trump administration is reportedly staging a new investigation that could serve as the foundation for additional import taxes.
The White House is preparing an "imminent" probe to explore whether any U.S. trade partners aren’t paying enough for medicines, the Financial Times reported Wednesday, citing three anonymous sources close to the matter.
Unlike the administration’s previous investigation into the national security implications of pharmaceutical imports, this new probe would come under Section 301 of the Trade Act of 1974, FT reported. The investigation could result in the White House drafting new pharmaceutical tariffs, the publication said.
The U.S. unquestionably pays more for drugs than most other countries, with the nonprofit Rand Corporation last year estimating that American prices are on average nearly three times higher than those in many other developed nations.
In recent months, this has become a rallying cry for President Donald Trump as he tries to coerce the industry to align its U.S. and international prices. While tariffs have largely been used as a tool to encourage companies to manufacture their products in the U.S., it increasingly seems they'll be at play in pricing discussions, too.
The threat and uncertainty of Trump’s drug tariffs have weighed heavily on the biopharma industry this year, even as the administration has repeatedly extended deadlines or walked back proposals on how the trade duties would manifest.
In late September, Trump announced on his social media platform Truth Social that the U.S. would impose a 100% tariff on “any branded or patented” pharmaceutical product starting Oct. 1, unless the drug’s manufacturer was actively building an American production facility.
But, now, it seems the administration isn’t enforcing that Oct. 1 tariff deadline as it carries out high-stakes drug pricing negotiations with major pharmaceutical companies. That particular strategy falls under Trump’s most-favored nation (MFN) drug pricing push, which broadly seeks to align the costs of U.S. medicines with lower prices in other comparator nations.
So far, Pfizer, AstraZeneca and Merck KGaA’s U.S. arm EMD Serono have inked formal MFN deals with the White House, agreeing to lower certain drug costs and participate in the president’s consumer purchasing platform TrumpRx. In all three instances, the companies also won temporary reprieves from the administration’s Section 232 tariffs.
By targeting the prices other countries pay for their drugs directly, the new reported investigation could offer a more comprehensive approach to imposing tariffs and enforcing pricing alignment.
The latest twist in the 2025 tariff saga comes after pharma companies of all stripes have pumped billions of dollars into U.S. manufacturing this year, largely in response to the threat of trade duties.
Meanwhile, multiple other drugmakers—such as Novo Nordisk, Eli Lilly and Johnson & Johnson—have suggested that they are actively in discussions with the Trump administration about drug pricing reforms that, as the first three MFN deals show, would likely make them immune from tariffs for the time being.