The Department of Commerce has started an investigation into how pharmaceutical imports affect national security, according to a notice published April 14 in the Federal Register.
The move is widely seen as a precursor to the U.S. imposing tariffs on pharmaceuticals, which President Donald Trump has been threatening for weeks.
Four more details:
- The Secretary of Commerce started an investigation April 1, “to determine the effects on national security of imports of pharmaceuticals and pharmaceutical ingredients, and their derivative products.” The government is accepting public comments regarding the investigation that are submitted within 21 days.
- The probe was initiated under Section 232 of the Trade Expansion Act. Under the law, the Commerce Department would be required to submit results from the investigation within 270 days, though officials within the administration have suggested the probe will conclude more quickly, according to Bloomberg.
- On April 8, President Trump said drug imports will soon face “major tariffs,” after pharmaceuticals were excluded from the initial round of reciprocal tariffs. Pharmaceuticals are currently subject to a universal 10% tariff.
- President Trump has touted tariffs as a way to boost domestic manufacturing and reduce the nation’s reliance on foreign goods. While many pharmacy and supply chain experts welcome measures to strengthen domestic manufacturing, they’ve warned that tariffs may lead to widespread supply chain disruption, including generic drug shortages and cost increases.
Major drug companies, including Novartis, have announced multi-billion dollar plans to expand U.S.-based manufacturing in recent weeks. However, ramping up U.S. production can take years to implement, experts say.
