Trump’s tariffs are affecting unlikely industries, targeting America’s cosmetic and weight loss markets

Later today, President Donald Trump is expected to announce sweeping tariffs on “all countries” intended to re-balance global trade and boost US manufacturing. Industries are bracing for impact and so are wrinkle-haters. This is because the cosmetic industry is in trouble if the EU is slapped with tariffs.

According to data from the US Trade Census, pharmaceutical goods were the most important thing the US bought from the EU in 2024, both in terms of value and type. Americans import a lot of cosmetic products. Therefore, in the pharmaceutical industry, those that will be mainly affected most are “beauty patients”

EU countries differ widely in their exposure to the already announced new US tariffs on cars, pharma, and steel exports.

Highest exposure on pharma (often reflecting tax incentives): 🇮🇪🇧🇪🇦🇹

On cars: 🇸🇰🇩🇪🇸🇪

In total, around 1% of GDP of EU exports are currently affected. pic.twitter.com/VND1L6oOWJ

— Daniel Kral (@DanielKral1) March 27, 2025

In fact, a part of the $127 billion worth of EU imports was semaglutide, which is found in famous weight loss drugs from Novo Nordisk, Ozempic, and Wegovy. At $15.6 billion, the GLP-1 chemical was the sixth most important thing that the US bought from the EU.

The EU could be met with 20% tariffs

Concerns about potential pharma tariffs began before Trump took office in January after he threatened universal import tariffs during his campaign. He has since repeatedly threatened a 25% tariff on pharmaceutical imports and on goods from the EU.

On Tuesday, the Washington Post said that White House staff had written a plan to put tariffs of about 20% on most goods. The paper mentioned three people who were familiar with the situation and said that advisors warned that many options were still open, which means that the 20% tariffs may not happen. 

Wall Street is paying close attention. Analysts say the taxes could mess up global supply chains, cause short-term drug shortages, and make businesses less profitable. Patients in the US are also at risk, not just companies in other countries. 

People who work in the industry say there is still hope for a phased method or a delay in implementation, but the mood has changed. In the past, Pharma has mostly agreed with Trump’s pro-business views. The silence is ending now.

The risk of imposing tariffs on the pharmaceutical industry

The aim of tariffs is to bring back manufacturing to the US. But here’s the catch: making drugs is not only expensive, it takes a long time. Opening a new FDA-approved facility in the US could take five years and cost up to $2 billion. That’s a lot to ask, especially for companies that make generic drugs that are already struggling to make ends meet.

Also, if there aren’t any protections in place, some businesses may leave the market, giving customers fewer choices and higher prices. It’s not that easy, even for big companies with businesses in the US. Novo Nordisk and Roche both have plants in the US, but it will take time to switch to complex manufacturing.

That’s not all that many people care about; they also want to know if the math works.

The industry has not folded its hands. Lobbyists for the industry are already working hard to get a steady phase-in so that there aren’t any sudden shocks. Eli Lilly, Pfizer, and GSK  are all rushing to get their hands on new supply lines. 

They are speeding up shipping and going over their backup plans. Ireland, which makes a lot of drugs for the US, saw an 81% rise in exports to the US in January alone. In other words, hoarding has already begun.

For instance, this week, two drug companies with headquarters in Europe told Reuters that they have been moving as many of their medicines across the Atlantic as possible for the past few weeks. They had heard that other drug companies were doing the same.

One of the execs said that his company was “scenario planning” for possible tariffs and sending more medicines by air using global shipping and cargo companies like DHL and United Parcel Service Inc.

As hope for a tariff-free deal for the pharmaceutical industry fades, the Stoxx 600 healthcare index fell 2% to its lowest level since December 20. German science and pharmaceutical company Bayer had one of its worst years, with a 3.8% drop in sales.

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