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Trump duties could increase drug costs, aggravate the bottlenecks

Trump duties could increase drug costs, aggravate the bottlenecks

Shana Novak | Stone | Getty pictures

The steep tariffs of President Donald Trump in Canada, Mexico and China could deteriorate the existing shortage of drugs in the USA, increase health costs for patients and endanger generic pharmaceutical manufacturers of cash.

Trump announced on Saturday that he would charge almost all of the goods delivered from Canada and Mexico for a tariff of 25% and a fee of 10% for imports from China, all of which should come into force on Tuesday. On Monday, both Mexico and Canada said that the tariffs would be during the break for about a month.

Nevertheless, the proposed import taxes occur, since the USA with an unprecedented lack of crucial medicine from injectable cancer therapies to generics to cheaper versions of brand names that have forced hospitals and patients to ration medicine. It also happens that many Americans have difficulty affording the high costs for prescription drugs.

The United States is heavily dependent on other countries for pharmaceutical products, especially for generics. These drugs make up 90% of the recipes of the Americans, so that tariffs may threaten the access of the patients to affordable treatments.

China in particular is a large provider of active pharmaceutical ingredients or APIs for both brand names and generics due to lower production costs in the country. APIs are the main component of a drug that causes the desired effect of the treatment. Some generics are completely overseas.

The tariffs could “increase problematic drug shortages” by forcing generic manufacturers from the market due to low profit margins, as from a statement by John Murphy, CEO of the Association for accessible medication that represents generic pharmaceutical companies.

“Generic manufacturers simply cannot start new costs,” said Murphy on Sunday. “Our manufacturers sell at an extremely low price, sometimes only, and are increasingly forced to leave the markets in which they are under water.”

He asked the Trump administration to take generic products from tariffs, and added that the total value of all generic sales in the USA, despite “volume growth” and new generic starts, has decreased by $ 6.4 billion in five years.

The alliance health distribution, which represents 40 drug distributors, also called for the administration of Trump to rethink, including pharmaceutical products in tariffs. In an explanation on Sunday, the group said that the tariffs would burden the pharmaceutical supply chain and “adverse American patients” whether this is due to increased costs for medical products or manufacturers who leave the market.

The group said the tariffs will put additional pressure on an industry that was already in financial emergency, and found that retailers are operated with low profit margins of only 0.3%.

The United States will probably see “a new and deteriorated lack of important medication”, and these costs are passed on to payers and patients, including those in the Medicare and Medicaid programs, “says the alliance health distribution.

An estimate from the Yale University household laboratory said that long -term prices for pharmaceutical products in the USA will be 1.1% higher after shifts in the supply chain.

Pharmaceutical research and manufacturer of America that represents pharmaceutical companies said in a statement that Trump’s goal shares to ensure that the United States maintains its “global leadership in biopharmaceutical innovations and production”.

The commerce should concentrate on “the treatment of unfair practices abroad and securing our intellectual property”, the group added.

Medical devices

The United States is also dependent on the production of medical devices in overseas, with many key components and finished products from countries such as China, Mexico and India.

For example, Intuitive surgicalthe Robotic Surgical Systems, which was revealed in his annual report last week, was made that an “significant majority” of the company’s instruments and accessories in Mexicali, Mexico are produced.

Customs on the country would “increase the costs of our products produced in Mexico and have a negative impact on our gross profit,” said the company.

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Advamed, the world’s largest mediation of the medical devices, asked the Trump administration to take out medical products from the tariffs. In an explanation, the group said that import taxes could lead to a lack of critical medical technologies, higher prices for patients and payers and fewer investments in research and development.

The tariffs and the associated costs essentially act as a “consumption tax in practice,” said Advamed and found that Trump provided a scope for a large part of the medical technology sector when he imposed tariffs on China in his first term.

Customs could also affect hospitals that rely on imports for everyday supplies such as dresses, gloves and syringes as well as larger objects such as X -ray devices.

The American Medical Manufacturers Association, which is committed to US companies that produce medical personal protective equipment (producing PSA, supports the tariffs for China and the increase in domestic production of these products.

In an explanation on Monday, the group said the tariffs recognized that China has not changed its ways and is still contrary and dangerous that harms PSA and medical supply manufacturers and threatens our supply chains and national security. “

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