Stakeholders Fear Proposed Tariffs Will Take a Toll on Biosimilars

Recently, President Donald Trump proposed tariffs on thousands of Chinese-manufactured products. According to the list produced by the United States Trade Representative (UTSR), which comprises more than 1300 Chinese products worth about $50 billion each year, some of these products are key ingredients used by drug makers.

A tariff of 25% would be placed on products from the automobile, aerospace, and information technology sphere, as well as the raw ingredients for drugs such as insulin, epinephrine, antibiotics, vaccines, and immunological products as well as some medical devices.

Some industry groups have begun voicing their concerns that these tariffs could have a negative effect on the production of generics and biosimilars, and may increase the cost of these products.

“We are assessing the proposed tariff list of pharmaceutical ingredients and products by the USTR and its possible impact on manufacturing costs for affordable, FDA-approved generic and biosimilar medicines. We are concerned that the proposed tariffs may lead to increased costs of manufacturing for generics and biosimilars and thus high prescription drug prices for patients in the United States,” said Jeffrey K. Francer, senior vice president and general counsel for the Association for Accessible Medicines (AAM) in a statement.

“In 2016, our member companies produced over 61 billion doses of generic and biosimilar medicines in the United States. AAM will maintain a dialogue with USTR to ensure continued patient access to generic and biosimilar medicines,” added Francer.

More than 80% of the ingredients used in the production of drugs prescribed to patients in the United States are produced outside of the country, according to the FDA. In fact, China, together with India, accounts for the production of so many ingredients that the FDA has referred to China as, “a major provider” of these key products.

In a recent interview, Novartis’ CEO, Vasant Narasimhan, MD, also voiced his concern. “I think it would only damage the global economy and obviously impact companies like us—we have manufacturing sites around the world, including in China and the United States. And we need to be able to run our global supply chains in a stable way.”

The Trump administration is requesting public comment on the USTR list until May 11, 2018, and will hold a public hearing on May 15 in Washington, DC.

Following the hearing, companies will have until May 22, 2018, to file any rebuttals.