Pharmaceutical giant Roche commits to $50 billion investment in US
Pharmaceutical giant Roche has announced it will invest $50 billion in the United States over the next five years to combat President Donald Trump’s global tariffs.
Drug price watchdog groups are concerned that President Donald Trump’s plan to impose 100% tariffs on some imported brand-name drugs could make patients’ pockets lighter.
But its fate is far from certain, given the warnings issued by the Trump administration as part of its April 2 sweeping order on tariffs on imported branded drugs.
According to the order, pharmaceutical companies that agree to move production to the United States will be subject to a 20% tariff during the transition, but will not be subject to tariffs if they also agree to reduce prices to “most-favored-nation” levels paid by other countries. If the drug is not produced in the U.S. within four years, full tariffs will be imposed.
The tariffs on major pharmaceutical companies will go into effect on July 31 unless the companies offer price concessions or step up domestic manufacturing. Smaller pharmaceutical companies have until September 29 to comply.
Merris Basie, CEO of Patients for Affordable Drugs, warned that the terms of the most-favored-nation agreements already announced “do not provide meaningful savings for the vast majority of American patients.”
“What Americans need is long-lasting structural reform,” Basie told USA TODAY. “What they don’t need is a temporary, voluntary agreement that is opaque and opaque.”
He added that Americans are already struggling with the prices of everyday items, and “when it comes to life-saving and essential medicines, even a small increase in the price of medicines that you have to pay every month can have a big impact.”
How has the Trump administration addressed drug affordability?
President Trump has made most-favored-nation status a central part of his administration’s efforts to lower drug prices for consumers.
The administration announced deals with 16 of the 17 major drug manufacturers it sent letters to in 2025 seeking price concessions for branded drugs. Regeneron, the only company that did not reach a most-favored-nation pricing agreement, expects to reach a drug pricing agreement in the near future, a Regeneron spokesperson said.
The Trump administration has touted these agreements as a benefit for consumers in Oval Office announcements, but has not made public the terms of the voluntary agreements. As of April 2, TrumpRx, the administration’s drug pricing website, lists prices for more than 50 brand-name fertility drugs, insulin, weight-loss drugs, and other drugs. The website does not process insurance claims, but instead directs consumers who pay cash to coupons that can be used on drug company websites or pharmacies.
Drug affordability remains the biggest concern
Most people with health insurance likely use their plan’s drug benefit to fill prescriptions. Still, affordability is a concern for most Americans.
About 6 in 10 Americans said they were worried about being able to pay for prescription drugs, according to a March survey by KFF, a nonpartisan health policy nonprofit. Four in 10 said they saved money by skipping doses rather than filling prescriptions or taking other cost-cutting measures.
Antonio Ciaccia, CEO of 46Brooklyn and a drug pricing expert, said if drug companies were slapped with a 100% tariff on branded drugs, they would have to at least double the price to pay the tariff.
Ciaccia said consumers and private health insurance plans would likely experience the largest price increases under such a scenario, citing inflation penalties imposed when drug companies significantly increase prices in the government health insurance programs Medicare and Medicaid.
“We’re all going to end up paying for it one way or another,” Ciaccia said.
What is excluded from tariffs on branded goods?
President Trump’s order broadly applies to brand-name drugs and drug ingredients, but excludes generic drugs, which account for nine out of 10 prescriptions for Americans.
Generic drugs have lower profit margins and often contain ingredients manufactured overseas, where manufacturing costs are typically lower.
“The generic drug and biosimilar industry recognizes the unique aspects of our industry’s supply chain and applauds the government for exempting generic and biosimilar drugs from tariffs,” John Murphy III, president and CEO of the Accessible Medicines Association, which represents generic drug manufacturers, said in a statement.
Murphy added that the Trump administration understands “not only the savings and access provided to American patients, but also the potential harms and unintended consequences associated with further straining the economy of our industry.”
The European Union, Japan, South Korea, Switzerland and the United Kingdom are exempt from tariffs due to existing trade agreements with the United States.
A White House official said the tariffs would help ensure the United States does not benefit from other countries for life-saving drugs.
“The United States is highly dependent on imports, and disruptions to global supply chains due to geopolitical or economic turmoil could limit America’s access to life-saving medicines,” the executive order signed by President Trump on April 2 said, adding that approximately 53% of patented medicines distributed in the United States are manufactured overseas.
Contributor: Zach Anderson
