US Commerce Secretary Howard Lutnick has said President Donald Trump will announce a new pharmaceutical policy within the next two weeks. It is expected to be more stringent than before.
As part of this policy, companies that fail to invest in domestic manufacturing could face massive tariffs.
The announcement comes on the heels of a major breakthrough with the European Union.
On Sunday, July 27, Trump confirmed a trade agreement had been reached with the EU following discussions with European Commission President Ursula von der Leyen. The deal comes just days before the August 1 deadline, when a 15% tariff is set to be imposed on most EU goods entering the US, including automobiles.
Lutnick described the EU deal as a “masterclass” by Trump, crediting the breakthrough to strategic pressure around pharmaceutical and auto exports.
“The EU didn’t want the US to remove pharma companies from Europe,” Lutnick added, noting that the fundamentals of the EU-US trade agreement are now in place.
While details of Trump’s forthcoming pharma policy remain under wraps, the administration has already laid the groundwork for a sweeping overhaul.
At a Cabinet meeting earlier this month, Trump signalled plans to impose a 50% tariff on copper and warned that tariffs on pharmaceuticals could reach as high as 200%, though implementation would allow companies a transition period of up to 18 months.
Citing national security concerns, Trump has launched an investigation under Section 232 of the Trade Expansion Act of 1962 into foreign pharmaceutical imports. “We’ll give them a certain period of time to get their act together,” Trump said, emphasising that the goal is to revive drug manufacturing in the United States.
Major pharma firms, including Eli Lilly, Johnson & Johnson, and AbbVie, have already begun ramping up US investments in anticipation of the policy shift.
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First Published: Jul 29, 2025 7:34 PM IS
