US President Donald Trump on Wednesday indicated that his plans to impose high tariffs on the pharmaceutical sector can star to come into effect as early as the end of this month.
He also mentioned that a similar tariff timeline is likely to be set for other critical imports like semiconductors.
While speaking with reporters, he said:
Probably at the end of the month, and we’re going to start off with a low tariff and give the pharmaceutical companies a year or so to build, and then we’re going to make it a very high tariff.
Donald Trump has revealed plans to roll out new tariffs on imported pharmaceuticals by the end of July. The initial rates will be modest, but could rise sharply up to 200% by the summer of 2026.
His administration intends to give drugmakers about a year to shift manufacturing to the US before ramping up the duties.
The move falls under Section 232 of the Trade Expansion Act of 1962, which allows trade restrictions for national security reasons.
The justification? America’s heavy reliance on foreign-made drugs, especially from China and India.
Some of the biggest names in global pharma like Eli Lilly, Merck, and Pfizer could be hit hard by the new tariffs, along with top Indian players like Sun Pharma, Dr. Reddy’s, Lupin, and Biocon.
All of them rely heavily on manufacturing facilities outside the US, putting them squarely in the crosshairs of the coming trade shift.
Trump on semiconductor and other tariffs
Semiconductor imports, especially from Asian countries like Malaysia and South Korea, could soon face new US tariffs as well.
Trump has hinted that imposing these restrictions may be “less complicated” than other trade measures, and they could roll out on a similar timeline as the pharmaceutical tariffs.
If enacted, the chip tariffs are likely to ripple through the tech supply chain, driving up prices on products like laptops and smartphones from giants such as Apple and Samsung, costs that would ultimately land on US consumers.
Trump says the goal of the tariffs is to bring manufacturing and jobs back to American soil. But industry analysts are warning of serious side effects.
Drug prices are expected to jump not just from the direct costs of the tariffs, but also from potential supply disruptions if companies can’t relocate production quickly.
Meanwhile, higher prices on semiconductors and electronics could feed into the broader inflation already showing up in June’s economic data.
Early analyses suggest these tariffs are already nudging up consumer prices, with estimates pointing to a short-term increase of at least 2.1%.
Real incomes are taking a hit, especially among lower-income households.
Looking ahead, the tariffs could drag down US GDP growth by 0.9% in 2025 and slash exports by nearly 18%.
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