Why the Trump pharma import investigation is pivotal for supply chains

The potential for tariffs on imported pharmaceuticals could have an impact on domestic manufacturing priorities.

In brief

• The Trump administration's Section 232 investigation into pharmaceutical imports raises concerns about supply chain vulnerabilities.
• National security implications are central to the investigation, focusing on foreign control over pharmaceutical supply chains.
• If tariffs are imposed, they could significantly impact drug affordability and accessibility, forcing pharmaceutical companies to rethink approaches.

The Trump administration’s recent Section 232 investigation into pharmaceutical imports has sent ripples through the industry, raising concerns about supply chain disruptions, pricing volatility and national security implications. With the potential for tariffs on imported pharmaceuticals, the industry faces a pivotal moment that could reshape global sourcing strategies and domestic manufacturing priorities.

Understanding Section 232 and its implications

Section 232 of the Trade Expansion Act of 1962 grants the president authority to impose import restrictions if an investigation by the Department of Commerce determines that such imports threaten US national security. Historically, this provision has been used to justify tariffs on steel, aluminum and automobiles. Now, the pharmaceutical sector is under scrutiny, with the administration citing concerns over foreign dependency on critical medicines and active pharmaceutical ingredients (APIs).¹

• National security concerns: The administration is seeking to understand the risks posed by foreign control over pharmaceutical supply chains. The efforts are focused on imports of pharmaceuticals and pharmaceutical ingredients, including finished drug products, medical countermeasures, critical inputs such as active pharmaceutical ingredients, key starting materials, and derivative products of those items.⁴

Authorities utilized by President Trump in second administration

Tariff implications:

If imposed, tariffs could range from $14.39B to $52.75B annually, significantly impacting drug affordability and accessibility.⁵

The estimated tax liability from pharmaceutical-specific tariffs is as follows:

• 2024 US imports trade value: $248.21 billion
• 10% tariff estimate: $14.39 billion
• 25% tariff estimate: $31.65 billion
• 50% tariff estimate: $52.75 billion

Potential industry impact

Strategic supply chain considerations for pharma leaders

Pharmaceutical companies are already taking action. In EY-Parthenon’s April 2025 CEO Outlook Survey on Life Sciences 88% said they are redrafting strategic investment plans in response to geopolitics and trade policies.⁸

Ninety -Four percent of CEOs are concerned about tariff increases affecting operations and sales in the next 12 months.

Potential short-term changes 

Potential medium- to long-term/strategic changes

The Trump administration’s Section 232 investigation into pharmaceutical imports marks a critical juncture for the industry. The potential consequences — ranging from supply chain disruptions to price volatility — require careful navigation. Pharma supply chain leaders must adapt, advocate and innovate to ensure continued access to life-saving medicines while addressing the evolving trade landscape.