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Investing.com - U.S. President Donald Trump on Monday signed an executive order aimed at boosting domestic pharmaceutical production, and warned that he will soon impose import tariffs on the sector.
Trump’s order will bring down the time taken to approve new pharma plants in the country, and instructs the Food and Drug Administration to streamline reviews while working closely with manufacturers to bring more production capacity online.
The Environmental Protection Agency was also ordered to speed up construction of new facilities.
The move is the latest by Trump to bring more drug manufacturing to the United States. Trump also signaled on Monday that he will slap import tariffs on pharmaceuticals in the next two weeks, after he had earlier this year launched probes into the sector to explore potential trade duties.
Trump has argued that foreign pharma products present a national security risk, due to the U.S.’s heavy reliance on imported drugs and medications.
Pharma tariffs could present significant headwinds to the industry, with the U.S. importing over $200 billion in prescription drugs annually. European companies may be among the worst hit by this trend, along with drug producers in India and medical equipment makers in China.
The threat of U.S. tariffs did see several pharma giants, including Roche (SIX:ROG), Novartis (SIX:NOVN), Eli Lilly (NYSE:LLY) and Johnson & Johnson (NYSE:JNJ) announce increased investments in domestic production over the past few weeks.
Shares in Eli Lilly and Pfizer (NYSE:PFE) were slightly lower in premarket U.S. trading on Tuesday, while Johnson & Johnson’s stock price hovered around the flatline. Elsewhere, several Indian drugmaking firms, especially those with exposure to the U.S., retreated.
Trump’s threat of pharma tariffs marks a fresh development in the president’s aggressive trade agenda. On Sunday, he threatened to impose 100% tariffs on foreign-made films.