Australia ‘Urgently Seeking’ Detail on Trump’s Drug Tariff Threat

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(Bloomberg) -- Australia is “urgently seeking” more detail on President Donald Trump’s threat to impose 200% tariffs on pharmaceutical imports to the US, Treasurer Jim Chalmers said.

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“These are obviously very concerning developments,” Chalmers told Australian Broadcasting Corp. radio in an interview on Wednesday. “Our pharmaceutical industry is much more exposed to the US market. And that’s why we’re seeking – urgently seeking – some more detail on what’s been announced.”

The US president said he planned to implement a 50% duty on copper imports while also indicating he could offer pharmaceutical manufacturers at least a year before applying a 200% tariff on their foreign-made products. Trump expects to offer pharmaceutical manufacturers some time to bring their operations to the US before imposing the import duties.

Chalmers said that while the US accounted for less than 1% of Australia’s total copper exports, the drug sector’s exposure was larger.

Australia exported A$2.1 billion ($1.4 billion) worth of medicinal/pharmaceutical products to the US in 2024, or 38% of the nation’s overseas shipments of pharmaceuticals. That accounted for 0.4% of total goods exports, according to AMP Ltd.

Earlier this week, the Guardian newspaper reported some of the most influential lobby groups in Washington are pushing the administration to retaliate against Australia’s treatment of US exporters under its A$18 billion Pharmaceutical Benefits Scheme, pointing to drug approvals and domestic manufacturing incentives as proof of unfair “freeloading”.

Australia’s PBS keeps the prices of nearly 1,000 commonly used medicines capped.

“I want to make it really clear once again, as we have on a number of occasions before, our Pharmaceutical Benefits Scheme is not something that we’re willing to trade away or do deals on,” Chalmers said.

“We see the PBS as a fundamental part of health care in Australia,” Chalmers added. “We’re not willing to compromise the PBS. We’re not willing to negotiate or trade away what is a really important feature of the health system.”