What to know about pharmaceutical tariffs

After months of uncertainty about whether they’d even happen, pharmaceutical tariffs have made a comeback.

Tariffs up to 100% on patented or brand-name pharmaceutical products and active ingredients take effect on July 31 for some large companies, and will take effect on Sept. 29 for all other companies that haven’t gotten an exemption, per an April 2 proclamation from President Donald Trump. Certain specialty drugs such as orphan drugs, fertility treatments, cell and gene therapies, and plasma therapies are exempt.

Haven’t been keeping up with this issue? We’ve got you! Here are three things to keep in mind as discussions on tariffs ramp up over the next few months.

Some background. Pharmaceuticals haven’t historically been subject to tariffs. This means many biotechs and biopharmas aren’t set up to deal with them, Lynlee Brown, a partner at professional services firm Ernst & Young’s (EY) global trade practice, told Healthcare Brew.

“It’s very different than, say, footwear and apparel that have a trade compliance group. They know this stuff because they have to,” she said. “From a life science, biopharma, biotech [perspective], it just never has been part of the calculation, so they didn’t really have that strong knowledge set.”

Planning the future. It’s important for biotech leaders to educate themselves about tariffs and make a plan so they can answer questions from investors, Patroski Lawson, founder of the American Biotech Innovation Alliance, told Healthcare Brew. The Alliance is a new industry association announced in May 2026.

“If I was a CEO of a biotech company, I would be asking more questions,” he said. “The time to make friends is before you need them…Go have meetings and conversations with anyone and everyone who will have a conversation with you about this, so that you are as wise as you can be on what the administration is planning.”

On top of it all. Venture capital investments shifted away from early-stage biotechs and more toward later-stage biotechs in 2025, according to EY’s 2026 Biotech Beyond Borders report. The report says this trend suggests investors are “increasingly selective and discriminating” toward risk in this industry.

Tariffs are one contributor to investor hesitancy, report coauthor Ashwin Singhania, a principal in the life sciences practice of EY-Parthenon, EY’s global strategy and transactions consulting arm, told Healthcare Brew.

“There is a dearth of dollars to fund early-stage biotech. When you compound that with NIH changes in funding, I think there is a real question mark about what it’s going to take to spur long-term innovation here, and how much of that is at risk at the moment,” Singhania said.