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Trump’s Tariff Shockwaves: Pharma, Trucks, and Global Trade on Edge
U.S. President Donald Trump announced sweeping new tariffs on Thursday, with headline measures including 100% duties on branded pharmaceuticals and 25% levies on heavy-duty trucks, set to take effect next week. The move adds to an already aggressive trade policy agenda, as the administration seeks to bolster U.S. manufacturing and protect national security.
Market Reaction: Mixed, With Pharma Under Pressure
- Asian stocks slid, particularly pharmaceutical companies, on fears that the new tariffs would hit global supply chains and increase costs.
- European equities, meanwhile, recovered from early losses, as investors awaited clarity on whether the levies will overlap with existing tariff ceilings outlined in recent trade deals.
- The uncertainty comes as companies and investors grapple with soaring costs, supply chain snarls, and weaker consumer demand amid the ongoing trade war.
Trade Deals & Tariff Confusion
Trump’s post on Truth Social did not specify whether the new tariffs are additional to existing duties.
- The EU and U.S. recently signed a preliminary trade deal that caps tariffs at 15% for certain products, including pharmaceuticals. The European Commission stressed that the deal was “clear” in limiting tariffs — calling it an “insurance policy” against higher duties.
- Japan said its trade agreement includes a guarantee that its tariff rates will not exceed those of other major partners.
This lack of clarity has heightened concerns in global markets about potential conflicts between Trump’s announcement and binding international agreements.
Pharmaceutical Industry Braces
Trump clarified that the 100% tariffs will only apply to drugmakers without U.S. manufacturing plants. This exemption has spared several pharmaceutical giants that have announced major domestic investments:
- Roche confirmed one of its U.S. units recently broke ground on a new facility.
- Novartis has pledged billions in U.S. investments, though it declined to comment on Thursday’s announcement.
- PhRMA, the main U.S. industry group, warned that new tariffs “risk undermining” hundreds of billions in planned investments.
Meanwhile, Ireland — home to a large concentration of U.S.-owned pharmaceutical factories — saw exports of chemical and pharmaceutical products surge 536% YoY in the first seven months of 2025, as companies frontloaded shipments to the U.S. in anticipation of Trump’s move.
Global Outlook: Growth and Inflation at Risk
For investors, uncertainty over the scope, duration, and enforcement of these measures is likely to fuel volatility across equities, currencies, and supply-chain-sensitive commodities.
Trump’s tariffs are the latest shock to global growth, with the Federal Reserve previously warning that they contribute to higher consumer prices in the U.S.
For Europe, Japan, and Switzerland, the risk now lies in whether tariff exemptions hold under existing agreements, or if a prolonged trade fight escalates.
