EU, Japan escape Trump's 100% tariffs on pharmaceuticals because of existing trade pacts
Under the terms of its framework deal, duties on EU pharmaceuticals will be capped at 15%
- Sep 27, 2025,
- Updated Sep 27, 2025 10:16 AM IST
President Donald Trump’s sweeping new tariffs on pharmaceutical imports will spare countries that already have drug provisions in trade agreements with the United States, a White House official confirmed Friday, offering relief to the European Union and Japan, according to Bloomberg.
Under the terms of its framework deal, duties on EU pharmaceuticals will be capped at 15%, the official said. Japanese drugs will be subject to the rate agreed in its pact, with a joint U.S.-Japan statement clarifying that tariffs on Japanese drugs and semiconductors would not exceed those applied to other partners, including the EU.
On Thursday, Trump announced that the U.S. would impose a 100% tariff “on any branded or patented Pharmaceutical Product, unless a Company IS BUILDING their Pharmaceutical Manufacturing Plant in America,” defined as “breaking ground and/or under construction.” He added that no tariff would apply “if construction has started.”
The abrupt declaration prompted questions in foreign capitals about whether existing agreements still applied. The White House official said companies announcing plans to build U.S. facilities would also qualify for exemptions while the Commerce Department reviews and approves their projects.
The administration has moved in recent days to enforce the EU trade understanding. Earlier this week, the U.S. cut auto tariffs to 15% from 25% on top of existing rates.
(With Reuters inputs)
President Donald Trump’s sweeping new tariffs on pharmaceutical imports will spare countries that already have drug provisions in trade agreements with the United States, a White House official confirmed Friday, offering relief to the European Union and Japan, according to Bloomberg.
Under the terms of its framework deal, duties on EU pharmaceuticals will be capped at 15%, the official said. Japanese drugs will be subject to the rate agreed in its pact, with a joint U.S.-Japan statement clarifying that tariffs on Japanese drugs and semiconductors would not exceed those applied to other partners, including the EU.
On Thursday, Trump announced that the U.S. would impose a 100% tariff “on any branded or patented Pharmaceutical Product, unless a Company IS BUILDING their Pharmaceutical Manufacturing Plant in America,” defined as “breaking ground and/or under construction.” He added that no tariff would apply “if construction has started.”
The abrupt declaration prompted questions in foreign capitals about whether existing agreements still applied. The White House official said companies announcing plans to build U.S. facilities would also qualify for exemptions while the Commerce Department reviews and approves their projects.
The administration has moved in recent days to enforce the EU trade understanding. Earlier this week, the U.S. cut auto tariffs to 15% from 25% on top of existing rates.
(With Reuters inputs)