Trump’s April announcement of a potential 100% tariff on imported drugs has divided the pharmaceutical industry into deal-makers and everyone else.
Big pharma found its path. Investment pledges and drug pricing commitments, structured around Most Favored Nation (MFN) terms, gave the largest players a negotiated exit from the tariff threat. The UK signed a similar arrangement, securing a reprieve as Britain moved to reattract pharmaceutical investment. For those firms, the threat is largely behind them.
Small- and mid-sized drugmakers haven’t had the same options. Without high-profile MFN pricing deals already in place, those companies face the full weight of the threatened 100% rate. Chris Young, a principal in KPMG’s trade and customs practice, confirmed the landscape remains far murkier for smaller players working through a rapidly evolving U.S. trade environment. They don’t have the deal-making muscle that insulated the biggest names.
The practical consequence: a 100% import tariff doubles the landed cost of any imported drug. Small- and mid-cap companies that haven’t reached government pricing agreements have no clear path to the same exemption big pharma carved out. Their options are limited, and the tariff policy is still being shaped by the White House.
The window to cut a deal, if that option exists at all for smaller firms, is open now. The policy’s next move will determine whether it stays that way.
James Okafor