SerpApi.Org
President Trump has put a long fuse on a big tariff threat aimed at cheap medicines. In a Truth Social post Tuesday, he said imports of generic drugs will keep their current zero tariff until Aug. 1, 2028, then face a 100% tariff for a year. After August 2029, the tariff will rise to 200%, Trump said, though he will no longer be in office by then. Trump described the move as a way to force manufacturers to build plants in the US, Politico reports.
・"This is done in order to RESHORE Generic Pharmaceutical Production into America, with a penalty to those Companies that decide not to build Plant and Equipment within the stated period of time given to them," Trump wrote. "The objective of this Policy is to protect the people of the United States."
The White House says it plans to invoke a national-security trade law, Section 232, but hasn't issued a formal order. Brand-name drugs are already set to face tariffs of up to 100% after a recent probe, though some big firms won exemptions via pricing deals. A leading generics trade group called for more details and pushed for broader policy fixes to support US production. In Europe and Asia, stocks in makers of generic medicines dropped on Wednesday, the Wall Street Journal reports.
Analysts say generic drug makers, which enter the market after patents expire and usually compete against other companies offering identical products, operate on much tighter margins than brand-name drug makers, CNBC reports. Industry leaders say they will likely either pass the tariff on to consumers or exit the market. Analysts at JP Morgan say Trump's proposal is probably a starting point for negotiations, reports the Journal. They say that since it will sharply increase costs for US consumers, it's doubtful whether the tariff at the rate Trump proposes will ever be implemented. (This content was created with the help of AI. Read our AI policy.)
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