CEO of Eli Lilly and Company David Ricks speaks on March 12, 2024 in New York City in the Economic Club of New York.
Spencer Platt | Getty pictures
Eli Lilly On Thursday, CEO Dave Ricks said that the drug maker could help react to national security concerns regarding cheaper essential medication, since pharmaceutical-specific tolls occur.
The Trump government has opened an investigation of § 232, as the import of certain medication into the United States influences national security – a step that is seen as a prelude to initiation of tariffs for medicines. It is unclear what these taxes will look like and whether they are aimed at branded or older generics, the latter of which are largely produced abroad in countries such as India and China.
“If we bring this capacity back, we have the stock in an emergency, we have the offer – that is a valid thing,” said Ricks in an interview with CNBC and referred to these older medication. After reporting the winnings and 2025 guidelines that did not contain any estimated effects of the potential pharmaceutical tariffs in the first quarter.
He said national security concerns regarding these medication were “valid”.
But he added: “I think tariffs are the answer? I'm not so sure.”
“We would be happy to talk to this administration or national security guards about how we can react to such a crisis,” he said. “We have capacities that we can bring there, and we are happy to help the country when we are in need.”
Older generic medication accounts for around 90% of the drugs prescribed in the USA, which are of crucial importance for hospital care, including antibiotics and vasopressors or medication that increase blood pressure.
Ricks noticed that these essential drugs are “not easy to make, but they are cheap and they were driven from our country due to costs and other harmful guidelines”.
However, some health experts said CNBC that tariffs on generics that have far lower profit margins than branded medication could force some generics to leave the US market as a whole. This could lead to the lack of certain generics in the United States or worsen, such as: B. sterile injectable drugs that are usually used in hospitals.
Rick's comments come as a drug maker for the planned pharmaceutical tariffs of President Donald Trump, who aim to increase household production. These tariff threats are already fueling a new wave of US manufacturing investments from the pharmaceutical industry.
This includes Eli Lilly, who announced in February that there will be at least 27 billion US dollars for the construction of four new production locations in the USA
On Thursday, Ricks said that the tariffs may not be necessary to remodel the production of the industry after moving the industry.
“I think that the threat from tariffs already brings critical supply chains back to important industries, chips and pharmaceuticals,” said Ricks. “So we have to issue [tariffs?] I'm not so sure. “
He added that Eli Lilly wants to see permanent lower tax rates in the USA, especially 15% for domestic production. Ricks said that lower taxes caused many drugmakers to control “low-tax islands such as Ireland, Singapore and Switzerland, and that can come back if there is an economic incentive”.
This reflects the feeling of Pfizer -CEO Albert Bourla's comments on Tuesday. Although Bourla argued that the uncertainty about tariffs keeps the company from investing in the manufacture, research and development.
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