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Swiss Pharma Industry Faces Uncertainty as Trump Imposes 100% Tariff on Branded Drugs

Trump's tariffs could hit Swiss pharma exports hard. While Roche and Novartis plan US investments, smaller companies may struggle.

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1 min read
There is a pharmacy store and there is a vehicle in front of it and there is a building in the left...
There is a pharmacy store and there is a vehicle in front of it and there is a building in the left corner.

Swiss Pharma Industry Faces Uncertainty as Trump Imposes 100% Tariff on Branded Drugs

Switzerland's pharmaceutical industry, a major economic driver generating 7-8% of the country's GDP, faces uncertainty following US President Donald Trump's announcement of a 100% tariff on branded pharmaceutical products. The move has sparked concern in Switzerland, home to giants like Roche and Novartis.

Trump's tariffs, set to take effect from Wednesday, could potentially impact many Swiss pharmaceutical companies, particularly those with significant branded product exports but no US production sites. While Roche and Novartis have announced plans to invest tens of billions in the US to avoid tariffs, many smaller companies could still be affected. The impact on Switzerland's overall economy could be severe, potentially leading to a recession if a large proportion of pharmaceutical exports to the US are burdened for a longer period, according to Hans Gersbach, co-director of the KOF Swiss Economic Institute. Despite the potential threat, the stock values of Roche and Novartis remained relatively stable following the announcement. In 2024, Switzerland had an almost 40-billion franc surplus in trade with the US, with almost two-thirds from the pharma-chemical sector. Novartis has already launched a direct-to-patient platform in the US to sell a discounted version of its Cosentyx drug, a move that could help mitigate the impact of potential tariffs on consumers.

The US's planned tariffs on Swiss pharmaceutical products have raised concerns about the potential impact on Switzerland's economy, with the country's pharmaceutical industry being a significant driver of growth. While Roche and Novartis have taken steps to invest in the US, many smaller companies could still be affected. The situation remains uncertain, with the impact on Switzerland's overall economy yet to be fully understood.

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