Trump tariffs could drive up generic drug costs: 5 takeaways

President-elect Donald Trump's proposed tariffs on foreign imports could lead to higher costs for generic drugs, policy experts say. 

While the tariffs would aim to boost U.S. manufacturing, experts note that most generic drugs are made overseas and tariffs could increase prices for consumers, NBC News reported Nov. 22. 

Here are five takeaways: 

1. If Mr. Trump imposes his proposed 20% blanket tariff on imports, the cost of generic drugs could go up. This is because few generic drugs are made in the U.S., with about half of all generics and 80% of active pharmaceutical ingredients sourced from countries such as China and India. 
   
   
2. The idea behind tariffs is to encourage U.S. companies to manufacture more products domestically. However, experts told NBC News this could backfire for generic drugs, with manufacturing becoming less profitable over the years and few companies willing to invest in new facilities. 
   
   
3. Experts also warn that tariffs could exacerbate drug shortages in the U.S., which include chemotherapy drugs, IV fluids and common medications such as painkillers and ADHD drugs. Tariffs could disrupt the supply chain, leading to shortages and higher prices for patients. 
   
   
4. Even if tariffs are applied only to active ingredients rather than finished products, they could still lead to higher costs for patients, as some drugs are made overseas but finished in the U.S. 
   
   
5. If tariffs make it difficult for generic drugmakers to profit, some may exit the market. This could reduce competition, leaving fewer options for consumers and possibly leading to higher prices for remaining medications, according to the report.