Pharmaceutical imports became the latest target for President Donald Trump’s tariffs, sending FTSE 100 drugmakers stock into the red.
Astrazeneca plunged seven per cent and GSK 5.7 per cent. Haleon closed off over three per cent.
This followed Trump reiterating his plans for tariffs on all “major” pharma imports during an event with the National Republican Congressional Committee (NRCC) on Tuesday.
“We’re going to tariff our pharmaceuticals and once we do that they’re going to come rushing back into our country because we’re the big market,” the President said.
According to White House documents, medicine had previously been exempt from tariffs.
The President has not specified when or how much he plans to tariff pharma imports.
Risk of pharma ‘exodus’ to US
European pharma companies have called on President of the European Commission Ursula von der Leyen to push for “rapid and radical action”.
The firms said there was a “risk of exodus” to the US following Trump’s threat.
The European Federation of Pharmaceutical Industries and Associations (EFPIA) warned Trump’s tariffs could lead to over €103bn (£89bn) of investments ditching Europe for the US.
Peel Hunt analysts said in a note on Tuesday: “Pharma companies’ ability to set up more US manufacturing will be slow (months to years).”
They added: “Historically, this is why previous US administrations have always carved out pharma and medtech from tariffs.”
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: “The threat of tariffs is now hanging over the pharmaceutical sector.”
Streeter said investors were “readying themselves to find out if Trump’s rhetoric about pharma imports will also turn into a highly unwelcome move”.
In Europe, shares in German drugmaker Bayer, which is listed on the STOXX 50, slumped 4.6 per cent, while Novo Nordisk plummeted seven per cent on the Copenhagen Stock Exchange.