The United States has launched a new tariff investigation against Germany, citing concerns over what it describes as Germany's "persistent underpayment for innovative pharmaceutical products." U.S. Trade Representative Jamieson Greer stated that President Donald Trump believes American patients should not bear an excessive share of global pharmaceutical research and development costs. The probe signals a potential for tariffs on German goods as a retaliatory measure.
Greer specifically expressed concern about Germany's pending legislation, which is expected to further reduce its spending on innovative pharmaceuticals. This move is seen as a "serious step backwards" at a time when U.S. trading partners are encouraged to increase their contributions to pharmaceutical development. The U.S. has previously engaged in a "charm offensive" across Europe to pressure governments to increase their payments for medicines.
This investigation follows a pattern of the U.S. administration's efforts to address perceived imbalances in pharmaceutical pricing. Earlier, the U.S. secured a deal with the United Kingdom that protected British pharmaceutical companies from U.S. tariffs for three years and committed the U.K. to increasing drug spending over the next decade. U.S. diplomats are now targeting Germany, Europe's largest medicines market, particularly as the country is undergoing a significant overhaul of its healthcare system, including drug pricing regulations aimed at cutting federal spending on medicines. This contrasts with the U.S. objective for Germany to increase its spending.
U.S. officials are reportedly holding secret talks with Berlin regarding drug prices. Major pharmaceutical companies, like Eli Lilly and Boehringer Ingelheim, have already announced reductions in planned investments in Germany, totaling billions of euros, in response to Germany's cost-cutting proposals. The U.S. had previously threatened significant tariffs, including three-figure tariffs on pharmaceuticals and double-digit tariffs on countries, which played a role in securing the U.K. agreement. For EU countries, a 15% U.S. tariff is already in place.
