Analysis Shows Tariffs on Canadian Pharmaceuticals Will Likely Increase Costs

New analysis published in JAMA found that “President Donald Trump’s trade tariffs on Canadian pharmaceuticals are expected to increase costs in the United States and strain drug supply chains.” CIDRAP has the news.

Scientists wrote in a research letter that the U.S. “imports 400 different ready-for-use medications from Canada, 28 of which have no alternative supplier.” The lead author wrote that the tariffs “could affect a wide range of medications, from antibiotics to mental health treatments,” and straining the supply chain “could trigger drug shortages and jeopardize patient care.”

The authors found that “22,082 drug products were sold in the U.S. market from the fourth quarter of 2022 to the third quarter of 2023, of which 411 (1.9%) were manufactured in Canada, representing $3 billion in sales.” Of those 411 products, “79% (323) were generic, and 21% (88) were brand-name products, including 20 (4.9%) under patent protection.”

Adding the 25% tariffs to the existing $3 billion in sales dependent on Canadian manufacturing adds about $750 million in cost. The authors stress that this provides “rationale for pharmaceuticals being exempt from tariffs to avoid increasing healthcare costs and worsening disruptions in U.S. supply.”