Smaller biotechs face 100% pharma tariff as big drugmakers sit — SkimNews
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- Trump administration announced a 100% Section 232 tariff in April on imports of patented drugs and their active ingredients, which took effect at the end of September
- White House outlined pathways to reduce the tariff burden, including striking most-favored nation (MFN) deals to sell drugs in the U.S. at prices comparable to other wealthy countries or committing to bring production to the U.S.
- Companies with MFN agreements will not have to begin paying tariffs until early 2029, after their original July payment deadline was deferred
- Largest U.S. drugmakers are largely exempt through those MFN arrangements, while smaller biotech firms are left to absorb the levy
- Biopharma companies and their industry group say many are being left in the dark on how to pursue exemptions
Why it matters: The 100% tariff structurally favors large drugmakers with the leverage to negotiate MFN pricing deals — those companies won't pay until early 2029 — while smaller biotechs that lack pricing power or domestic manufacturing face immediate levies on patented drug imports, a compliance wall that could squeeze supply chains and drug development budgets without a clear exemption roadmap.
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