There is a (accredited to) Chinese curse saying “May you live in interesting times.” Interestingly, I always interpret this sentence as a positive wish. I mean, who wants to live in boring times, right?! But I just recently learned that the meaning actually is exactly opposite as it is used sarcastically with “interesting times” more standing for “times of trouble”.
However, I think we undeniable live in interesting times, in every acceptation of the words. And some of the recent troubles which seem to worry European based pharmaceutical companies relate to the more protectionist and aggressive politics by the current POTUS, Donald J. Trump.
Especially US-first politics, the risk of high tariffs, and cost pressure on the high prices for pharmaceutical products in the US raise substantial concerns. As a result – and this certainly might be a totally biased and subjective observation – European-based pharma companies seem to ‘pause & wait’. Others use the situation as a justification for internal reorganizations and hiring freezes.
But how real are the risks?
Protectionist trading practices by the US
… is what we are actually talking about. And tariffs are more a tool for the same. Where the snake is just an inhabitant of the dangerous jungle you might be in.
The situation in 2025 and the upcoming years is, that this seems to be the dominating politico-economic road for the US. I am not judging, just noticing. This is the situation, independent if we like it or not.
For some European-based companies this will be a substantial economic risk. Especially for those without a strong and own US-based pillar. It will be harder to get products into the US at reasonable costs.
For others, especially ‘big pharma’ companies, who typically have a own US entity, own US production sites, own US research sites, dedicated US employees working on US contracts for a US subsidiary … for those – in full transparency – I do not fully understand the risk. This is a serious question. Possibly I am missing something, but so far no one has been able to comprehensibly explain to me what the challenge would be.
Yes, OK, there are global production and trade chains in place. Like for every US-based company producing whatsoever. There is no US industry not being in the same situation. So … until someone shows up with a plausible explanation, I need to assume that ‘sit & wait’ as well as ‘we don’t dare to hire’ are nothing else than bad excuses.
Cost pressure on high prices for prescription drug in the US
Honestly spoken, in the year 2025 no one should really be surprised that the convenient market situation (for pharma sales) in the US will change sooner or later. This is not specific to Trump. This is a topic being discussed for decades now. And over the last 10 years pressure on the current model is persistently increasing. A series of high-level US politicians, presidents and senators, across all political parties, including Obama and Biden, have or had the substantial decrease of costs for prescription drugs on their agendas.
I personally would be more concerned about pharmaceutical companies not seriously anticipating and strategically planning for the expectable situation. US drug prices will go down. Dramatically go down. If not in 2026 then in 2030, or any time before or after. And this will impact pharma’s business and revenues in the US. Any company, any product team not being well prepared for this will be in trouble. Independent of who the president is going to be.
So, Trump’s meaty words should be nothing more a final warning for getting prepared. But for me any of both, taking hectic actions or falling into depression, wouldn’t be signs of good and professional strategic company leadership and management.
Feel free to drop me a comment if you agree or think that I am on the wrong track. I am curious about your thoughts.
