Portal Innovations’ John Flavin: Tariffs on pharma could raise costs and delay drug access

Potential Impact of Tariffs - A 100% tariff on pharmaceutical companies is threatened if they don't build manufacturing plants in the US, potentially increasing the burden on US consumers and insurance companies [1][2] - Tariffs could increase the cost of bringing new drugs to market and negatively impact young startups relying on outsourced opportunities for cost-competitive clinical trials [3] - Short-term concerns exist regarding changing supply lines and the capacity for onshoring final manufacturing of active pharmaceutical ingredients, potentially causing delays in bringing products to US patients [5] Onshoring and Investment - Onshoring of manufacturing is viewed positively, with companies like Eli Lilly, Novartis, and Roche announcing investments of over $20 billion in new plants [4] - Building plants in the US may lead to favorable treatment regarding tariffs, particularly for patented technologies, while generic products may not be affected [6][7] - US manufacturing is beneficial for national security, especially after COVID-19 revealed the risks of outsourcing early-stage and raw ingredient supply lines [11] FDA and Regulatory Concerns - Concerns exist regarding the FDA's willingness to approve certain therapies, potentially impacting investment decisions [8] - Confusing factors, including threats to NIH funding and mixed messages around the FDA process, create uncertainty for investors [12][13] - Efforts to accelerate the drug approval process are viewed favorably by investors and patients [12] Innovation and Market Dynamics - US innovation in treating rare diseases using CRISPR and cell therapy is expected to continue transforming and addressing unmet patient needs [10] - Trade deals with countries like Japan and Korea may shield them from the tariffs [14]