BPI warns after tariff agreement between EU and USA: Pharmaceutical sector continues to be under pressure – healthcare provision insufficient
29.07.2025 13:24
After months of negotiations, the EU and the US have agreed on a preliminary agreement in the tariff conflict. The US will impose a flat tariff of 15 percent on EU imports – including pharmaceutical products, with the exception of certain generic drugs. Despite a slight easing of tensions, the German Pharmaceutical Industry Association (BPI) sees no reason to sound the all-clear:
"Our industry has been hit hard again. The fact that pharmaceuticals are now also subject to a flat-rate tariff for the first time is a worrying breach of taboo. It once again exposes the vulnerability of global supply chains in the healthcare sector," emphasizes BPI Chairman Oliver Kirst.
"Even if the originally threatened 30 percent tariff was averted, the flat tariff rate of 15 percent for pharmaceuticals remains a serious burden – both for our companies and for the supply chain in Europe and the USA as a whole," emphasizes Kirst. EU Commission President Ursula von der Leyen stated yesterday evening after the negotiations that the tariff compromise had created new planning security for companies on both sides of the Atlantic. However, she indicated that further "special regulations" could follow regarding how pharmaceuticals would be handled in the future – which, from the BPI's perspective, does not represent a real gain in stability. "So it remains to be seen what will happen next," says Kirst.
Tariffs affect directly and indirectly
The new agreement also leaves existing tariff rates untouched – particularly on steel and aluminum. These remain subject to a 50 percent tariff. Kirst clarifies: "When it comes to tariffs, manufacturers of pharmaceuticals and medical devices are generally under pressure – also indirectly through supply chains. If intermediate products, excipients, or packaging materials become more expensive, this has a direct impact on production and supply. It is crucial for medical care that pharmaceuticals, medical devices, combination products, as well as veterinary medicinal products and veterinary medical devices, must not become pawns in trade conflicts."
Additional risks from reference price discussion
In addition to tariff policy, another international development is increasingly coming into focus for the pharmaceutical industry: the discussion surrounding the introduction of so-called "Most Favored Nation" mechanisms in US drug pricing. "What at first glance sounds like a relief measure for the US healthcare system poses considerable risks for the European pharmaceutical supply. If the US were to base its drug prices on the – already lower – European price levels in the future, this would fundamentally change the global pricing architecture," warns Kirst. "If manufacturers have to fear that the prices they achieve in Europe will directly impact the US market in the future, this will inevitably have an impact on launch decisions. One possible consequence would be that companies deliberately avoid European markets so as not to jeopardize their pricing base in the US – with direct consequences for the supply situation here," says Kirst.
Health must not be collateral damage of trade policy
The BPI therefore appeals to European and German politicians to specifically strengthen Europe as a pharmaceutical location and permanently secure global supply and trade relations. "Our industry needs planning security, fair market access, and a clear political stance on the strategic relevance of healthcare," demands Kirst. "Not only tariffs, but also regulatory interventions in global pricing jeopardize access to innovative therapies in the long term – the supply of medicines to patients must never be compromised by economic or geopolitical considerations."
background
The USA is Germany’s most important partner in the pharmaceutical trade. According to BPI Pharma Data 2024 Around 23 percent of all German pharmaceutical exports, worth €26 billion, went to the USA. In return, Germany imported pharmaceutical products worth €12.4 billion from the USA in 2023—around 17 percent of total imports.