Sandoz Responds to Trump’s US Tariff Threat on Generic Drug Imports
By Marleen Kaesebier
Impact and Reactions to US Tariff Threat on Generic Drugs
Sandoz’s Position and Ongoing Discussions
ZURICH, July 22 (Reuters) - Swiss generic drugmaker Sandoz said on Wednesday it would continue discussions with policymakers after U.S. President Donald Trump threatened the industry with steep tariffs unless drugmakers manufacture medicines domestically.
Trump said in a post on X on Tuesday that generic drugmakers will have to manufacture medicines for the U.S. locally or be hit with a 100% tariff from August 2028 followed by a 200% tariff starting the year after.
Generic Medicines in the US Market
More than 90% of medicines sold in the U.S. are generics, according to the U.S. Food and Drug Administration.
Sandoz’s Commitment to Affordability and Access
"We share the goal of improving affordability and access to medicines in the United States," Sandoz said in a statement. It added it would continue discussions with policymakers on how to best achieve this, as first reported by the Wall Street Journal.
Sandoz’s US Manufacturing and Future Plans
Closure of Long Island Facility
Sandoz said in 2024 that it would close its only U.S. manufacturing site on Long Island, New York, around the end of 2026. It said it was too early to assess any implications for manufacturing operations or future investment decisions.
Industry Analysis and Global Implications
Analyst Insights on US Policy Shift
Vontobel analyst Stefan Schneider said the U.S. government is aiming to reverse the shift of generic drug production to lower-cost countries, although bringing manufacturing back would likely raise generic drug prices in the United States.
Impact on Global Manufacturers
He added that any new rules would predominantly affect China and India, where most generic drugs are manufactured, but would also weigh on Sandoz, with around 22% of its sales in North America and little production there.
Market Reaction
Sandoz shares fell around 3% after the market open on Wednesday.
(Reporting by Marleen Kaesebier in Zurich and Maggie Fick in London, Editing by Louise Heavens)
