Global drugmakers are greeting President Trump’s decision to impose 100% tariffs on imported pharmaceuticals with a relative shrug, saying they can weather the new taxes because they’ve invested heavily in U.S. operations.
Drug companies generally see tariffs as a costly drag on research and development. Yet Mr. Trump is exempting medicine from companies that have built, or are starting to build, factories and operations in the U.S.
Novartis, a Swiss multinational pharmaceutical corporation, said it’s far along in a $23 billion investment in U.S.-based infrastructure, with five new sites to begin construction before the end of the year.
“We are well prepared with product supply in the U.S. through mid-2026, due to our agile manufacturing planning,” the company said. “Therefore, the announced 100% tariff should not have an impact on Novartis.”
Novo Nordisk, a Danish multinational company, said “cranes are rising” at a U.S. manufacturing site in North Carolina as part of the $24 billion it has invested over the past decade in American commercial operations, research and manufacturing.
CEO Mike Doustdar said its oral GLP-1 treatment for obesity — the Wegovy pill — “will be launched first in the U.S. and proudly manufactured 100% in the U.S.” — if it’s approved by regulators.
“This milestone underscores both our commitment to U.S. patients and our confidence in the country’s role as a leader in biopharmaceutical innovation,” Mr. Doustdar said.
The companies are among several drugmakers that announced U.S.-based investments in recent months.
The Pharmaceutical Research and Manufacturers of America, a major lobby, said most innovative medicine is already made in America and credited Mr. Trump’s tax and regulatory policies for driving manufacturing to the U.S.
At the same time, it said tariffs could hold back some projects.
“Tariffs risk those plans because every dollar spent on tariffs is a dollar that cannot be invested in American manufacturing or the development of future treatments and cures. Medicines have historically been exempt from tariffs because they raise costs and could lead to shortages,” said Alex Schriver, a senior vice president at PhRMA.
Some Democrats are worried the tariffs will make certain drugs unaffordable.
“Prescription drug prices are already unaffordable for many Americans, and President Trump’s new tariffs will only drive costs higher,” said Rep. Linda Sanchez, California Democrat and ranking member on the House Ways and Means Subcommittee on Trade. “To make matters worse, he is also threatening additional tariffs on critical medical supplies, including everything from surgical masks to respirators and wheelchairs to hospital beds.”
Mr. Trump announced the pharmaceutical tariffs as part of a bundle of levies that also targeted imported kitchen and bathroom cabinets, upholstered furniture and heavy-duty trucks.
In the stock market, PACCAR, an American truck company with brands such as Kenworth and Peterbilt, rose on the news that Mr. Trump planned to slap a 25% levy on heavy trucks made outside the U.S.
“We need our Truckers to be financially healthy and strong, for many reasons, but above all else, for National Security purposes!” Mr. Trump wrote on Truth Social.
The announcement could have implications for German truck makers such as Daimler Trucks and Traton.
In written statements, Daimler said it is “closely monitoring the situation,” while Traton said it “must first be evaluated internally” before it could comment.
Volvo Trucks said it would like to see the full regulation, beyond Mr. Trump’s social media post, but pointed to its robust U.S. manufacturing.
“We understand the administration’s motivation, because an unintended consequence of the current environment is that trucks built in the U.S. have actually been disadvantaged compared to trucks built in Mexico,” the company said. “Volvo Group operates in the U.S with two truck brands: Volvo and Mack Trucks. All trucks for the U.S market [are] being built within the U.S.”
Tariffs are taxes imposed on foreign goods as they enter U.S. markets.
Mr. Trump says tariffs are a great way to gain leverage over other countries, collect billions in revenue for the Treasury and protect domestic manufacturers.
Free market economists and Democrats have criticized the tariffs as too costly for U.S. businesses that rely on imports. Consumers may face higher prices when the costs are passed along.
Wayne Winegarden, a senior fellow in economics at the Pacific Research Institute, said the furniture tariffs could harm homeowners and renters “at a time when housing affordability is a real concern.”
“These additional costs will further reduce consumption growth and worsen the economy’s prospects,” he said.
Blue states and import-reliant businesses say Mr. Trump overreached by invoking a 1977 economic-emergency law to impose sweeping reciprocal tariffs on dozens of trading partners. The case is before the Supreme Court.
The case does not, however, affect the sector-specific tariffs that Mr. Trump imposed on cars, steel and aluminum and now drugs, furniture and heavy trucks.
He is relying on national-security provisions, such as Section 232, to impose those levies.
Mr. Trump recently launched a national-security probe into imported robotics and industrial machinery, which could lead to more tariffs.
National Association of Manufacturers CEO Jay Timmons said the domestic industry can produce at most 84% of the inputs needed for robotics and machinery. He said tariffs on the remaining 16% could be counterproductive.
“Tariffs on critical manufacturing inputs would significantly increase costs on equipment and machinery on factory floors across the country,” he said, “which could in turn stall investment in new plants and equipment right here at home at a time when manufacturers want to help President Trump create more U.S. manufacturing output and jobs.”
• Tom Howell Jr. can be reached at thowell@washingtontimes.com.