US President Trump proposes 100% tariff on imported prescription medications

US President Signs Executive Order on Pharmaceutical Tariffs

United States President Donald Trump has signed an executive order that could impose tariffs of up to 100 percent on certain patented pharmaceuticals if companies fail to reach deals with his administration within the coming months.

The order, which was issued on Thursday, establishes a framework for tariffs on imported pharmaceuticals. Companies that have signed a “most favoured nation” pricing deal and are actively building facilities in the US will be exempt from tariffs. Those that don’t have a pricing deal but are building such projects in the US will face a 20 percent tariff, which will increase to 100 percent in four years.

The administration has already reached 17 pricing deals with major drugmakers, 13 of which have signed. The executive order applies to pharmaceuticals and pharmaceutical ingredients, citing national security concerns as the reason for the tariffs.

The tariffs are set to take effect after a period of negotiation between companies and the administration. Smaller companies will have 180 days to negotiate, while larger companies will have 120 days. The European Union, Japan, Korea, and Switzerland will face a 15 percent tariff on patented pharmaceuticals, while the United Kingdom will face a 10 percent tariff.

The executive order is the latest move in Trump’s efforts to address what he sees as high prices for pharmaceuticals. The administration has used the threat of new levies to strike deals with major companies over the past year, promising lower prices for new drugs.

Source: Al Jazeera