Pharmaceutical Business Worth More Than $100 Billion Could Shift to US, Says European Trade Group

Trump has said he plans to announce tariffs on pharmaceuticals ‘very shortly.’

European Commission president Ursula von der Leyen holds a press conference in Samarkand, Uzbekistan, on April 3, 2025. Vyacheslav Oseledko/AFP via Getty Images

Europe must make radical policy changes, failing which, more than $100 billion in funding for pharmaceutical research, development, and manufacturing could move to the United States, warned the European Federation of Pharmaceutical Industries and Associations (EFPIA).

A survey of 18 EFPIA member companies conducted last week found that up to 85 percent of capital expenditure investments worth 50.6 billion euros ($56 billion) and as much as 50 percent of R&D expenditure valued at 52.6 billion euros ($58 billion) were “potentially at risk” of shifting to the United States, the trade group said in an April 8 statement directed toward European Commission President Ursula von der Leyen.

The at-risk figure is based on a total of 164.8 billion euros ($182 billion) worth of planned investments in the 27-member European Union bloc over the 2025–29 period.

Within the next three months, 16.5 billion euros ($18 billion), or 10 percent of this planned investment, is at risk, the group said.

“The U.S. now leads Europe on every investor metric from availability of capital, intellectual property, speed of approval to rewards for innovation,” it said.

“In addition to the uncertainty created by the threat of tariffs, there is little incentive to invest in the EU and significant drivers to relocate to the U.S.”

To ensure Europe sustains its pharmaceutical industry, the CEOs in the survey suggested that the bloc achieve a competitive market that attracts and rewards innovation and strengthen intellectual property provisions, among other measures.

“Europe needs to make a serious commitment to invest in a world-class pharmaceutical ecosystem, or, at best, risk being reduced to a consumer of other region’s innovation,” EFPIA said.

The industry group’s warning comes as U.S. President Donald Trump is planning to announce tariffs on pharmaceutical imports.

During a speech on Tuesday at the National Republican Congressional Committee, Trump said that pharmaceutical tariffs will soon be implemented.

“And once we do that, they’re gonna come rushing back into our country because we are the big market,” he said.

“The advantage we have over everybody is that we are the big market. So, we’re gonna be announcing, very shortly, a major tariff on pharmaceuticals. And when they hear that, they will leave China, they will leave other places, because most of their products are sold here.”

Tariff Impact on Trade

A recent survey of U.S. biotech companies by the Biotechnology Innovation Organization (BIO) found that tariffs on foreign imports could stifle medical innovation and reduce access to affordable medicine.

“A staggering 94 percent of biotech firms anticipate surging manufacturing costs if tariffs are placed on imports from the European Union,” it said.

“Proposed tariffs on the EU would force 50 percent of companies to scramble for new research and manufacturing partners. Half of those surveyed say they would have to rework or potentially delay regulatory filings, jeopardizing the pace of innovation.”

Last year, medicinal and pharmaceutical products were the most exported category of goods from the EU to the United States, with the bloc shipping off nearly 80 billion euros ($88 billion) worth of these products.

For the United States, medicinal and pharmaceutical products were the second-most exported goods to the EU, with the country selling more than 30 billion euros ($33 billion) of these goods.

According to a post by ING Bank, the United States is estimated to have consumed around $560 billion worth of pharmaceutical products last year, out of which $200 billion, or roughly 36 percent, was imported.

Ireland has been the top exporter of pharmaceuticals to the United States in recent years, followed by Germany and Switzerland, the bank said.

The EU faces various tariffs from the United States, including 25 percent charges on steel, aluminum, and cars, as well as reciprocal tariffs of 20 percent.

On Wednesday, the European Commission said that EU member states voted in support of a proposal to institute countermeasures against U.S. tariffs on steel and aluminum products from the bloc.

“The EU considers U.S. tariffs unjustified and damaging, causing economic harm to both sides, as well as the global economy. The EU has stated its clear preference to find negotiated outcomes with the U.S., which would be balanced and mutually beneficial,” the commission said.

Trump recently asked the European Union to buy energy from the country to gain relief from the tariffs.

“The European Union’s been really tough over the years. We have a [trade] deficit with the European Union of $350 billion, and it’s going to disappear fast,” he said.

“And one of the ways that that can disappear easily and quickly is they’re going to have to buy our energy from us. ... They can buy it, we can knock off $350 billion in one week.”