As of March 4, a 20% tariff applies to all pharmaceutical products imported from China. While tariffs of 25% on imports from Mexico and Canada were initially planned, they have been paused for goods that meet the USMCA rule of origin.

A new wave of tariffs is expected to be announced by April 2, targeting the so-called “Dirty 15.” Although the full list has not been released, the countries with the largest U.S. trade deficits will presumably be included. The EU, India, and Japan are widely expected to be affected, given the scale of their trade surpluses with the U.S. (Wall Street Journal, 2025; Fortune, 2025) An overview of current and expected tariffs is visualized in the QYOBO Tariff Tracker (Figure 1).

The “Dirty 15” – presumably countries with the largest U.S. trade deficits – account for (Figure 4):

• 87% of total U.S. finished drugs import value and 79% of export value
• 88% of U.S. raw material imports and 86% of exports

This illustrates the substantial exposure of U.S. pharma trade to upcoming tariff measures.

The U.S. recorded significant trade deficits in 2024 (Figure 4):

• $117 billion for finished pharmaceuticals 
• $30 billion for raw materials

Many leading pharmaceutical companies rely heavily on the U.S. market (Figure 7). Among originators, Bristol Myers Squibb (70%), Eli Lilly (64%), Novo Nordisk (63%), and Pfizer (61%) generate the largest share of their revenues from the U.S., while AstraZeneca (40%), Hikma (31%), and Bayer (28%) have a lower reliance.

In the generics sector, companies such as Teva (49%), Aurobindo (48%), Dr. Reddy’s (47%), and Zydus (46%) derive a significant portion of their revenues from the U.S., whereas Divi’s (14%) and Torrent (10%) have a more limited presence in the market.

However, the impact of tariffs depends on a company’s manufacturing footprint – insights the QYOBO platform provides through its comprehensive supply chain intelligence.

Johnson & Johnson, for example, maintains production sites across the EU, Switzerland, Israel, Puerto Rico, and the U.S (Figure 8). In the case of Ustekinumab, the company’s reliance on European manufacturing facilities places the product at high risk of tariff-related cost increases (Figure 9).

Under current USMCA Rules of Origin (USMCA, Rules of Origin), Canadian and Mexican pharmaceutical manufacturers can import Chinese APIs tariff-free and process them into finished drugs, qualifying these products as North American. In contrast, U.S. manufacturers importing the same Chinese APIs directly face a 20% tariff imposed during the Trump administration. As a result, these U.S. tariffs on Chinese imports have effectively placed domestic pharmaceutical manufacturers at a competitive disadvantage for the time being.

The pharmaceutical supply chain is already under pressure from persistent drug shortages and pricing challenges, particularly in the generics market. New tariffs introduce further uncertainty. As Novo Nordisk CEO Lars Fruergaard Jørgensen cautioned, “If you put tariffs on [generic medicines], I have a hard time seeing that that is not going to lead to other shortages of medicine or increased pricing in general.”(Bloomberg, March 2025)

Companies affected by higher import tariffs are likely to pass increased costs on to consumers and payers, resulting in rising drug prices across the board. For generics manufacturers, who operate on especially thin margins, a 25% tariff may render certain products unprofitable (Figure 10). This could lead to supply disruptions if manufacturers choose to discontinue affected products. In markets with a concentrated supplier base, such withdrawals heighten both pricing pressure and the risk of shortages.

• The U.S. has introduced a 20% tariff on pharmaceutical imports from China, with additional tariffs expected on April 2 for the so-called “Dirty 15”, likely including countries with the largest U.S. trade deficits such as the EU and India
• U.S. pharmaceutical imports rely heavily on countries subject to current or potential tariffs, particularly the EU, China and India
• Few originator companies, such as Novo Nordisk and Johnson & Johnson, have announced significant U.S. manufacturing investments, while generics manufacturer Sandoz remains reluctant to invest amid uncertainty
• USMCA tariff exemptions allow Canadian and Mexican FDF manufacturers to avoid tariffs on Chinese APIs, giving them an advantage over U.S. manufacturers
• Higher drug prices and potential supply shortages are likely, especially in the generics market where tariffs cannot be as easily absorbed compared to high-margin originator products

• Between 2022 and 2023, API prices dropped by 5%
• Between 2023 and 2024 they continued to decline by another 4%
• 64% of APIs experienced a median price decrease of -13%
• 26% of APIs recorded a median price increase of +13%

The QYOBO AI price forecast analyzes historical data patterns and trends for more than ten years. Using a proprietary machine learning model based on six different algorithms, it calculates how API prices will develop over the next three months and adjusts predictions whenever new data becomes available.

QYOBO’s predictive models are self-learning and rigorously back-tested to ensure the highest-quality insights. Our commitment to accuracy means that forecasts are only available for substances where our models have previously demonstrated precise price predictions. As a result, this exclusive capability covers 142 APIs — approximately 14% of the Top 1,000 index — ensuring reliable, data-driven decision-making for our clients.  For the next three months, the forecast indicates that 80 APIs are expected to maintain stable prices, while 26 APIs are projected to experience a 2–5% price increase. Meanwhile, 24 APIs are expected to see a 2-5% price decline (Figure 6).

• 56% of APIs are expected to maintain stable prices (from -2% to +2%)
• 20% of APIs are projected to experience a price increase
• 24% of APIs are expected to see a price decline (Figure 7)