Upcoming Tariff Changes Impacting Pharmaceuticals

April 7, 2026

Summary of Changes (Effective July 31, 2026 for some companies; September 29, 2026 for others)

Beginning on the applicable effective date, a baseline 100% ad valorem tariff will be imposed on imported patented pharmaceuticals and associated pharmaceutical ingredients (including active pharmaceutical ingredients and key starting materials).

Lower tariff rates will apply to certain countries with U.S. trade agreements, and additional reduced or zero‑rate options are available for companies that commit to reshoring and, in some cases, Most-Favored-Nation (MFN) pricing.

Country‑Specific Rates (No Reshoring Requirement):

15% tariff: European Union, Japan, South Korea, Switzerland, and Liechtenstein
10% tariff: United Kingdom

A tiered, incentive‑based structure allows reduced or zero tariffs for companies that commit to onshoring U.S. production, and/or enter into MFN drug pricing agreements with the Department of Health and Human Services (HHS).

Reshoring Incentives:

Companies that agree to reshore production will receive a temporary 20% tariff rate while U.S. facilities are under construction, increasing to 100% on April 2, 2030
Companies that reshore and agree to MFN drug pricing will qualify for a 0% tariff during construction

Current Status:

17 pharmaceutical companies have committed to reshoring and MFN pricing
13 companies have executed agreements
4 companies remain in active negotiations

Generic pharmaceuticals, biosimilars, and associated ingredients will not be subject to tariffs at this time and will be reassessed in one year.

Orphan drugs, drugs for animal health, and certain other specialty pharmaceutical products will be exempt, if they are from trade deal countries or meet an urgent public health need.

You can read the full proclamation here: Adjusting Imports of Pharmaceuticals and Pharmaceutical Ingredients into the United States – The White House