EU–US Trade Deal Could Cost Pharma Industry Up to $19 Billion

July 29, 2025 – The new EU–US trade deal could add $13–$19 billion in costs to the pharmaceutical industry as branded European medicines face a 15% import tariff when sold in the United States.

Pharmaceuticals have historically been tariff‑free, but under the agreement, only certain generic drugs will remain exempt. The European Union supplies about 60% of all US pharmaceutical imports, making this a major policy shift with global implications.

Higher Costs, Higher Prices?

Analysts warn that unless mitigated, the tariffs could raise consumer prices in the US. ING’s Diederik Stadig projects $13 billion in extra expenses, while Bernstein’s Courtney Breen estimates $19 billion — though some costs may be absorbed through strategies like:

Stockpiling medicines in the US
Securing new deals with contract manufacturing partners

Industry Moves to Limit Impact

Major European drugmakers are already adjusting:

Sanofi sold a New Jersey manufacturing site to Thermo Fisher, ensuring its therapies can still be made in the US.
Roche is boosting US inventories to avoid supply disruptions.

The exact list of exempted generics remains unclear, adding uncertainty for manufacturers like Sandoz.

Tariffs and Trade Politics

The US had been considering sector‑specific tariffs of up to 200% as part of a national security review. While most analysts believe the 15% duty will stand, UBS’s Matthew Weston says protective clauses for EU exports may be included in the final agreement — similar to talks with the UK and Switzerland.

Bottom line: The EU–US pharma tariff marks a major change in transatlantic trade. Whether costs are passed on to consumers or offset by strategic moves will shape the future of drug pricing and supply chains in both regions.