The European Union is going to pay the US a tariff rate of 15% when it comes to pharmaceutical products as part of a new trade deal between the two countries, although there are uncertainties looming on the future duties.
The trade deal has in it a broad range of industries, which includes timber, cars, and aluminum. The White House has not revealed the full details on the pharmaceutical import framework that has been agreed upon with the EU, although it has said that the 15% rate goes on to fundamentally rebalance the economic partnership between the two largest economies of the world.
It is well to be noted that pharmaceutical relations between the US as well as Europe have been tested in 2025 as the US president Donald Trump went on to impose the blanket tariffs, which have impacted the medicine supply chains. Pharmaceutical products were in the past exempt from duties; however, the industry was bracing for certain targeted duties because of investigations from the US government.
Apparently, there are many multinational pharma companies that have been vocal in their opposition when it comes to high levies and are even bracing themselves for a rate that isas high as 200%, as has been threatened by Trump. This remark was made in the wake of the beginning of the Section 232 investigation by the government into the drug sector, which is assessing the role of medicine imports when it comes to national security. The outcome of this probe is due by August 2025, and it is still not clear if Trump will add further duties.
But in a statement, Ursula von der Leyen, the President of the European Commission, said that Europe is not going to accept rate additions. She said that this 15% tariff on EU is a clear ceiling with no stacking—all inclusive.
It is well to be noted that medicines happen to be the largest European exports to the US in terms of value, and the EU accounts for almost 60% of total pharmaceutical imports to the United States. Top-selling drugs like Humira from AbbVie, Keytruda from MSD, and Ozempic from Novo Nordisk happen to be manufactured in Europe and sent to the US, which means that drugs that represent billion-dollar markets are going to get affected.
As per the US Pharmacopeia, which happens to be a nonprofit that tracks the drug supply chain, Europe goes on to manufacture active ingredients for 43% of the brand-name drugs that are administered in the US.
Although the tariff rate happens to be a blanket levy that applies to branded products, there are certain generic drugs that will be exempt.
It is worth noting that while the agreed rate of 15% tariff on EU is lower than the rates that were threatened by Trump in the early part of 2025, it still goes on to represent a setback to the global pharmaceutical industry. Apparently, there would be new import costs, which would likely add billions of dollars when it comes to expenses for drug makers, which is most likely going to be passed onto the patients through higher drug costs.
The forecast from analysis states 15% tariff on EU could ramp up the industry expenditure by $13 billion to somewhere around $19 billion every year, as per Reuters.
The European Federation of Pharmaceutical Industries and Associations (EFPIA) has maintained that the tariffs on medicines are going to be ineffective. The trade body in a statement said that tariffs on medicines are indeed a blunt instrument that is going to disrupt the supply chains and have an effect on investment within research and development, thereby ultimately harming the patient access to medicines on both sides of the Atlantic.
The trade body further said that there are more effective means other than tariffs, which would help rather than hinder, such as worldwide advances in patient care as well as economic growth. Francois Bayrou, the French Prime Minister, said that the EU had capitulated to Donald Trump, therefore remarking that it was a dark day for the European Union. There are certain economic observers who have commented that the UK could as well stand to gain from the trade deal since their tariff rates remain at 10%.
