As European pharma companies expect a separate tariff from President Donald Trump, they have warned the European Commission to amend a proposed revamp of laws governing the sector or else tariffs would expedite the industry’s shift toward the United States.
“Now with 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.,” the Pharma trade lobby EFPIA said in a statement.
EFPIA, whose members include European pharma giants Bayer, Novartis and Novo Nordisk, gave the warning to the European Commission president at a meeting on Tuesday, saying it had called on EU President Ursula von der Leyen to push for “rapid and radical action” to mitigate the “risk of exodus” to the United States.
Trump said last week that they would face separate tariffs after exempting pharmaceuticals from sweeping tariffs on U.S. imports.
The EU, the EFPIA said needs to change its regulatory framework for the industry to make it more conducive to innovation and strengthen Europe’s intellectual property provisions.
The demands were not new. EFPIA has repeatedly warned that Europe’s pharma sector will lose out to increased competition from the United States, China and emerging markets if the EU does not amend a proposed revamp of laws governing it.
A statement from the commission said Novo Nordisk, Novartis, Fresenius, Sanofi, Bayer, Gedeon Richter and Ipsen Chiesi attended the call.
Furthermore, the statement said the industry raised “strong concerns” about the rippling impact of U.S. tariffs on global supply chains and medicine availability in Europe, as well as regulatory barriers within the EU.
The industry also pushed for simpler “procedures for clinical trials and digitalisation of the European health system, as well as for protection of intellectual property. They urged ambition and speed with upcoming initiatives … notably the EU Biotech Act,” the statement added.
Biotech lobby Europabio, the European Confederation of Pharmaceutical Entrepreneurs and generics trade group Medicines for Europe also attended the meeting.
Europe and the United States have interconnected supply chains for medicines. The United States depends on medicines partly produced in Europe that bring in hundreds of billions of dollars in revenue.
EU medical and pharmaceutical product exports to the United States totalled about 90 billion euros ($97.05 billion) in 2023, according to the latest Eurostat data.
European pharma giants have recently been expanding production facilities in the United States.
The United States is the biggest pharma market by sales for big pharma companies, both U.S. and European headquartered ones. Sales in North America accounted for nearly 50% of world pharmaceutical sales in 2021, compared with nearly 25 per cent for Europe, according to EFPIA.
The European Commission proposed counter-tariffs on Monday of 25 per cent on a range of U.S. goods, including soybeans, nuts and motorcycles.
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