Industry asks US to exempt Korean drugs from tariffs

‘Korea supplies high-priced drugs at low prices’

KoreaBIO-MOHW submits ‘tariff opinion’ to the US

”South Korea is a reliable partner…supplies drugs to the US at low prices"

”Should refrain from imposing tariff measures on pharmaceuticals... If unavoidable, exempt Korean products"

In preparation for the US government's potential imposition of tariffs on pharmaceuticals, the Korea Biotechnology Industry Organization (KoreaBIO) has followed the Ministry of Health and Welfare in submitting an official opinion statement.

 

The opinion statement submitted to the US government states that South Korea is a reliable partner in the US medicine supply chain and is capable of supplying expensive prescription drugs to the US at low prices.

 

KoreaBIO announced on the 7th that it had officially submitted a statement regarding the “National Security Investigation of Pharmaceutical and Pharmaceutical Ingredient Imports” to the U.S.

 

government on the 6th (U.S.

 

local time).

 

The U.S.

 

Department of Commerce launched an investigation on the 1st of last month to assess the impact of pharmaceutical and pharmaceutical ingredient imports on national security.

 

As part of this effort, the department solicited public comments from stakeholders in various countries from the 16th of last month to the 7th of this month.

 

In its statement, the KoreaBIO emphasized that “Korea is a reliable partner in the U.S.

 

pharmaceutical supply chain and an affordable partner capable of supplying high-cost prescription drugs at lower prices.” KoreaBIO cited the National Security Commission on Emerging Biotechnology (NSCEB), an advisory body to the U.S.

 

Congress, in expressing concerns over the imposition of tariffs on pharmaceuticals.

 

The NSCEB previously stated that “the United States must develop innovative biotechnology and cooperate with its allies to stabilize the supply chain for the sake of national security.” KoreaBIO explained, “Korea plays a crucial role as a partner producing pharmaceuticals needed by the U.S.,” adding, “Especially, Korea is gradually expanding cooperation with U.S.

 

companies for the contract manufacturing of biopharmaceuticals.” KoreaBIO warned that “It takes at least several years to develop a stable pharmaceutical supply chain in the United States,” and that “imposing tariffs before the supply chain is established in the United States could lead to drug supply shortages for American patients, ultimately having a negative impact on U.S.

 

national security.” KoreaBIO emphasized, “Korea is making a significant contribution to the Trump administration's efforts to expand access to affordable medicines through active development and supply of biosimilars.

 

Korea plays a crucial role in supplying the medicines and pharmaceutical raw materials needed by U.S.

 

patients stably and cost-effectively.” Finally, KoreaBIO reiterated, “We request that the U.S.

 

government refrain from imposing trade restrictions such as tariffs on pharmaceuticals.

 

If such measures are unavoidable, we request that pharmaceuticals and pharmaceutical raw materials produced in allied countries such as South Korea, which do not pose a threat to U.S.

 

national security, be exempted.” The U.S.

 

government's decision on whether to impose tariffs on pharmaceuticals remains undecided, despite the announcement of a “separate application” policy on May 2.

 

Earlier, U.S.

 

President Donald Trump announced plans to impose tariffs on a wide range of products worldwide.

 

Specifically, tariffs of 25% would be imposed on aluminum, steel, and automobiles, while a basic tariff of 10% would apply to all other products.

 

However, all measures other than tariffs on China have been postponed.

 

Pharmaceuticals have been temporarily excluded from the 10% basic tariff.

 

The White House explained on the 2nd of last month that “President Trump is considering separate industry-specific tariffs on semiconductors, pharmaceuticals, and key minerals.” The MOHW also submitted a statement with a similar message on the 4th (local time).

 

The MOHW emphasized that “imports of Korean pharmaceuticals do not pose a threat to US national security and rather contribute to supply chain stability and improving patient access, so tariffs are unnecessary.” The MOHW emphasized that “the trade of pharmaceuticals between South Korea and the US is a strategic cooperation based on mutual trust and has contributed to the strong alliance between the two countries,” adding, “Despite the difference in the size of the pharmaceutical industries and medical markets of the two countries, the US is a major importer of pharmaceuticals in South Korea, which demonstrates the close economic and health cooperation forged between the two countries.” The MOHW explained, “Practical cooperation is important for stabilizing the drug supply chain in the US and reducing the burden on patients.

 

Korean CDMO companies can support US pharmaceutical companies' dual sourcing and contribute to supply chain stability and reducing the burden of drug prices on patients.

 

The joint response of the two countries during the pandemic demonstrates how such cooperation is directly linked to national security.” The MOHW said, “We look forward to maximizing mutual benefits through future cooperation based on mutual trust,” and proposed, “We will strengthen cooperation between the two countries to enhance access to essential medicines and promote innovation, and maximize mutual benefits by establishing a supply chain based on mutual trust.”