EU Accepts 15% US Pharma Tariff, Ending 30-Year Zero-Tariff Pact
Updated
Updated · World Economic Forum · Jun 29
EU Accepts 15% US Pharma Tariff, Ending 30-Year Zero-Tariff Pact
2 articles · Updated · World Economic Forum · Jun 29
Summary
A 15% US tariff on EU pharmaceutical exports has broken a 30-year zero-tariff regime, marking a sharp shift in the economics of global drug development.
The change compounds pressure from broader America-first policies—pricing rules, science funding cuts and FDA overhaul—that the report says are turning the US market into a fortress and making European launches commercially risky.
Europe is already losing ground in research execution: the European Economic Area's share of global clinical trials nearly halved over 10 years to 12% in 2023, while China's rose from 8% to nearly 30%.
The report argues Europe must respond by cutting R&D costs with AI—where pre-clinical savings of 30% to 70% are already reported—and by expanding adaptive regulation and health-data access to speed launches.
Without that overhaul, European patients could face delays in getting medicines discovered by European scientists, while the region risks a hollowed-out life sciences industry and weaker preparedness for future health crises.
As drug development shifts east, will European patients be last in line for the next generation of cures?
Can Europe's bet on AI and data reverse its decline in the global race for new medicines?
Why is the US penalizing EU medicines with tariffs while giving the UK a free pass?
How 2025’s 250% US Pharma Tariff Threats Reshaped Global Drug Supply and Trade Policy
Overview
In July 2025, former President Donald Trump’s threats to impose tariffs of up to 250% on pharmaceutical products created immediate pressure on the industry. These warnings sent shockwaves through healthcare supply chains, forcing pharmaceutical companies to quickly re-evaluate their global manufacturing and distribution strategies. Trump’s demand for price cuts, along with new discussions about reference pricing, introduced significant risks and intensified the urgency for companies to adapt. As a result, the pharmaceutical sector faced a period of rapid adjustment, with firms under pressure to respond to both the threat of high tariffs and the push for lower drug prices.