Global Pharma industry has been buzzing about the looming tariffs from the US being applied for everything from Hello Kitty chotchkie to, ‘say it ain’t so’, pharmaceuticals.
The angst caused by a big spike in pricing is the easiest layer to understand….. but wait, other layers lurk below the surface. The article below spotlights the hot issues… “Critical components like active pharmaceutical ingredients (APIs), excipients, packaging materials and processing equipment will now be subject to duties, forcing companies to face immediate cost increases, compliance challenges and market uncertainty. With the prospect of escalating rates and retaliatory trade measures, the financial and operational stakes are climbing fast.”
The article provides a great analysis of the repercussions that U.S. tariffs are likely to have on the pharmaceutical industry, emphasizing the challenges and risks that companies must navigate in response to new trade policies.
Key concerns include:
Implications of Tariffs: The applications of tariffs on finished goods are likely to turn marketing forecasts on their heads given current uncertainty.
Supply Chain Risks: The impact of tariffs the direct and indirect manufacturing and production costs .
Importance of Trade Compliance: Accurate classification under the Harmonized Tariff Schedule is essential to avoid severe penalties. Misclassifications can disrupt supply chains and delay shipments.
Financial Strain on Generic Manufacturers: Tariffs disproportionately increase costs for generic drug manufacturers. This could have direct downstream effects on retail pharmacies and healthcare providers.
Challenges of Reshoring: Reshoring operations is a complex and costly endeavor that requires significant time and investment.
Global Regulatory Challenges: U.S. pharmaceutical companies may encounter increased scrutiny and barriers in international markets as other countries respond to U.S. trade measures, further complicating global supply chains.
How Trump’s pharma tariffs disrupt drug supply chains
CLICK HERE to access the full article
