Goodbye to low drug prices: How tariffs on pharmaceuticals could increase costs for seniors
Experts are warning that tariffs on pharmaceutical imports could increase prices for patients.
Though many of the reciprocal tariffs that the White House announced last week have been put on pause, President Trump remains committed to imposing additional duties on pharmaceuticals in the coming weeks.
These tariffs would join the 10 percent baseline tariff on nearly all imports, the 25 percent duty levied against Mexico and Canada (excluding goods covered by the USMCA), the 25 percent tariff on steel and aluminum products, and the whopping 145 percent tariffs slapped on China. The White House had mistakenly said that the tariff imposed on China would be 125 percent.
The president began talking about additional tariffs on pharmaceuticals earlier this week, claiming that it would force drug companies to move their operations to the United States.
However, that process could take time, and until the infrastructure is built, tariffs could lead to higher prices for prescriptions. For seniors, who are more likely to take medications, tariffs could hit them disproportionately hard. However, there are programs that low-income seniors can take advantage of to reduce the amount of their income spent on prescription drugs.
How a tariff on pharmaceutical imports could impact prices
No confirmation has come from the White House regarding the level at which pharmaceutical products would be taxed. Still, the 25 percent figure has been floated based on past actions on steel and aluminum imports.
ING, the Dutch bank, released a report on April 1, stating that a 25 percent tariff on pharmaceutical imports could lead to an increase of $0.12 per pill for “commonly prescribed and relatively cheap generic drugs,” amounting to an average annual increase of $42.
When looking at how the prices of “more complex and expensive generic drugs” could be impacted, ING warns that the tariffs will have a more severe impact. Some of the drugs included in this category are used to treat cancer and could see an increase in cost anywhere between $8,000 to $10,000 for a 24-week prescription.
ING also noted that countries like Ireland, which imports twenty percent of drugs consumed in the US, as well as other Germany, Switzerland, India, and Japan, could see their industries harmed by these taxes. All are considered allies of the US and are eager to negotiate with the Trump administration to reach an agreement on trade that would avoid the imposition of the punitive reciprocal rates that had been announced last week on ‘liberation day.’
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