US begins probes into pharmaceutical and chip imports, setting stage for tariffs

[ThatRobGuy]

https://www.cnn.com/2025/04/14/business/pharmaceuticals-probe-chip-imports-tariffs/index.html

Reuters —
The Trump administration is kicking off investigations into imports of pharmaceuticals and semiconductors as part of a bid to impose tariffs on both sectors on national security grounds, notices posted to the Federal Register on Monday showed.


With all of the bickering about various tariffs, I do feel these two sectors, in particular, make sense to encourage domestic production.

There could be legitimate concerns about being beholden to other countries in terms of our supply for medicine and semiconductors.

 

[durangodawood]

Americans are already not paying enough for pharmaceuticals. They are way too cheap.

 

[FireDragon76]

https://www.cnn.com/2025/04/14/business/pharmaceuticals-probe-chip-imports-tariffs/index.html

Reuters —
The Trump administration is kicking off investigations into imports of pharmaceuticals and semiconductors as part of a bid to impose tariffs on both sectors on national security grounds, notices posted to the Federal Register on Monday showed.


With all of the bickering about various tariffs, I do feel these two sectors, in particular, make sense to encourage domestic production.

There could be legitimate concerns about being beholden to other countries in terms of our supply for medicine and semiconductors.

How exactly are pharmaceuticals 'national security' concerns? A sad state of affairs that Americans are so sickly they need drugs for 'national security'.

It would be better to offer incentives to companies in the form of tax deductions, if Trump believes getting more semiconductor manufacturing in the US is so important for national security. Blanket tarriffs on electronics from Asia will do nothing good for the US economy.

 

[durangodawood]

How exactly are pharmaceuticals 'national security' concerns? A sad state of affairs that Americans are so sickly they need drugs for 'national security'.

It would be better to offer incentives to companies in the form of tax deductions, if Trump believes getting more semiconductor manufacturing in the US is so important for national security. Blanket tarriffs on electronics from Asia will do nothing good for the US economy.

I do think theres a valid natl security argument for domestic capacity in these two sectors.

We saw it pretty clearly in covid, just with basics like PPE.

 

[Aryeh Jay]

Americans are already not paying enough for pharmaceuticals. They are way too cheap.

That's one of the three things that those fentanyl pushing Canadians would come to the US for, cheap gas, cheap booze, and cheap pharmaceutical drugs.

 

[ThatRobGuy]

How exactly are pharmaceuticals 'national security' concerns? A sad state of affairs that Americans are so sickly they need drugs for 'national security'.

While the U.S. does produce a significant portion of its drugs domestically—about 53% by dollar value in 2020, the country remains heavily dependent on imports for finished pharmaceutical products.

In terms of volume, countries like China play a more substantial role, especially concerning generic drugs and active pharmaceutical ingredients (APIs). In 2023, China accounted for over 57% of U.S. pharmaceutical imports by weight. Specifically, China supplied 217.2 million kilograms.


Certainly, one can understand concerns with regards to a country with low transparency, that just so happens to be dipping their toes in realm of biological weapons development, supplying a significant portion of the generic drugs and pharmaceutical ingredients, correct?


"Hey, I've been researching ways to use chemicals as a form of warfare against adversaries...you know, that research that I do in that lab that nobody else is allowed to inspect or look inside of...by the way, here's those pills you ordered"

 

[Aryeh Jay]

While the U.S. does produce a significant portion of its drugs domestically—about 53% by dollar value in 2020, the country remains heavily dependent on imports for finished pharmaceutical products.

In terms of volume, countries like China play a more substantial role, especially concerning generic drugs and active pharmaceutical ingredients (APIs). In 2023, China accounted for over 57% of U.S. pharmaceutical imports by weight. Specifically, China supplied 217.2 million kilograms.


Certainly, one can understand concerns with regards to a country with low transparency, that just so happens to be dipping their toes in realm of biological weapons development, supplying a significant portion of the generic drugs and pharmaceutical ingredients, correct?


"Hey, I've been researching ways to use chemicals as a form of warfare against adversaries...you know, that research that I do in that lab that nobody else is allowed to inspect or look inside of...by the way, here's those pills you ordered"

Two parts, it's funny we have a pharmaceutical industry but can't domestically make drugs for lethal injection.

One of them no name lab's in North Michigan makes my medicine with draino.

 

[rambot]

While the U.S. does produce a significant portion of its drugs domestically—about 53% by dollar value in 2020, the country remains heavily dependent on imports for finished pharmaceutical products.

In terms of volume, countries like China play a more substantial role, especially concerning generic drugs and active pharmaceutical ingredients (APIs). In 2023, China accounted for over 57% of U.S. pharmaceutical imports by weight. Specifically, China supplied 217.2 million kilograms.


Certainly, one can understand concerns with regards to a country with low transparency, that just so happens to be dipping their toes in realm of biological weapons development, supplying a significant portion of the generic drugs and pharmaceutical ingredients, correct?


"Hey, I've been researching ways to use chemicals as a form of warfare against adversaries...you know, that research that I do in that lab that nobody else is allowed to inspect or look inside of...by the way, here's those pills you ordered"

I can completely understand the logic.

I wonder what the government is going to do to help its citizens absorb the increased costs though. Americans already pay WAY more for anything health related than any major nation. That means there MUST be cheaper ways to deliver services.

Is the consumer just expected to absord every cost and every additional cost related to health care? I mean obviously they are; that's the same in EVERY jurisdiction. I suppose I ask that question as a "when are you going to help people?" kinda vibe.

 

[Aryeh Jay]

I can completely understand the logic.

I wonder what the government is going to do to help its citizens absorb the increased costs though. Americans already pay WAY more for anything health related than any major nation. That means there MUST be cheaper ways to deliver services.

Is the consumer just expected to absord every cost and every additional cost related to health care? I mean obviously they are; that's the same in EVERY jurisdiction. I suppose I ask that question as a "when are you going to help people?" kinda vibe.

How much is your life worth to you?
How much is your life worth to the government?

Decisions Decisions

 

[Richard T]

How exactly are pharmaceuticals 'national security' concerns? A sad state of affairs that Americans are so sickly they need drugs for 'national security'.

It would be better to offer incentives to companies in the form of tax deductions, if Trump believes getting more semiconductor manufacturing in the US is so important for national security. Blanket tarriffs on electronics from Asia will do nothing good for the US economy.

Suppose you are on a drug that basically extends your life. This means that without it you are at high risk of heart attack, blood clot, an immune system out of control, diabetes or other any other condition that will spin you out of control if you do not get the medication/treatments that you have been reliant on. Others too need drugs to help them function, they are unlikely to die but they are nowhere near 100%.
In a wartime situation you can't depend on any shipments from anywhere. Trade might be too difficult even if countries were willing to send such supplies. If the enemy is your old supplier, then forget it. So the USA needs to increase manufacturing not just for making the drugs but also the raw materials that go into them. To me this is a no brainer.
I will offer a second reason to manufacture in the USA. While generics are touted as being safe as the name brand drug the FDA allows 20% variance in the active ingredient. Most only vary 3% or so, but some drugs that need tighter tolerances to the targeted dose can vary more. Testing too on the absorption rates and other characteristics are not always performed on generics and their inactive ingredients or fillers can cause side effects. Here is a Harvard Study that shows higher ER visits from generics versus name brand drugs. Do generic drugs compromise on quality? - Harvard Health
Most generics come from China and India. Not only is the tap water questionable, but so are other raw materials, hygiene and overall factory cleanliness and quality. Yes, the USA can also have shoddy workmanship, but we could expect better overall quality because the FDA is better than many other exporting nations safety agencies. Here is a quote from the FDA.
"On April 24, 2008, during Senate hearings on the heparin fiasco, Janet Woodcock, MD, the Director of the FDA's Center for Drug Evaluation and Research (CDER), testified before the Senate Education, Labor, Health, and Pensions Committee, and stated, "We cannot be the quality-control unit for the world." She also said that the increasingly large number of pharmaceutical ingredients manufactured abroad makes it nearly impossible for the agency to ensure the safety of all drugs sold in the United States." FDA Inspection of Foreign Drug Companies
So let's make sure on drugs in the USA. Bring the jobs back and help our security and health. US productivity would be far higher and I don't think that manufacturing drugs consume huge amounts of labor but if prices increased slightly on generics then we all should be glad to accept them if we assume our quality and more secure supply can improve.

 

[FireDragon76]

Suppose you are on a drug that basically extends your life. This means that without it you are at high risk of heart attack, blood clot, an immune system out of control, diabetes or other any other condition that will spin you out of control if you do not get the medication/treatments that you have been reliant on. Others too need drugs to help them function, they are unlikely to die but they are nowhere near 100%.
In a wartime situation you can't depend on any shipments from anywhere. Trade might be too difficult even if countries were willing to send such supplies. If the enemy is your old supplier, then forget it. So the USA needs to increase manufacturing not just for making the drugs but also the raw materials that go into them. To me this is a no brainer.
I will offer a second reason to manufacture in the USA. While generics are touted as being safe as the name brand drug the FDA allows 20% variance in the active ingredient. Most only vary 3% or so, but some drugs that need tighter tolerances to the targeted dose can vary more. Testing too on the absorption rates and other characteristics are not always performed on generics and their inactive ingredients or fillers can cause side effects. Here is a Harvard Study that shows higher ER visits from generics versus name brand drugs. Do generic drugs compromise on quality? - Harvard Health
Most generics come from China and India. Not only is the tap water questionable, but so are other raw materials, hygiene and overall factory cleanliness and quality. Yes, the USA can also have shoddy workmanship, but we could expect better overall quality because the FDA is better than many other exporting nations safety agencies. Here is a quote from the FDA.
"On April 24, 2008, during Senate hearings on the heparin fiasco, Janet Woodcock, MD, the Director of the FDA's Center for Drug Evaluation and Research (CDER), testified before the Senate Education, Labor, Health, and Pensions Committee, and stated, "We cannot be the quality-control unit for the world." She also said that the increasingly large number of pharmaceutical ingredients manufactured abroad makes it nearly impossible for the agency to ensure the safety of all drugs sold in the United States." FDA Inspection of Foreign Drug Companies
So let's make sure on drugs in the USA. Bring the jobs back and help our security and health. US productivity would be far higher and I don't think that manufacturing drugs consume huge amounts of labor but if prices increased slightly on generics then we all should be glad to accept them if we assume our quality and more secure supply can improve.

It seems morally reckless to plan in such detail for such a scenario, as if war with China is a foregone conclusion.

 

[CRAZY_CAT_WOMAN]

Why would Trump care if medicine gets to high for the poor or middle class. President's don't have to pay for insurance. They are set for life.

 

[mindlight]

https://www.cnn.com/2025/04/14/business/pharmaceuticals-probe-chip-imports-tariffs/index.html

Reuters —
The Trump administration is kicking off investigations into imports of pharmaceuticals and semiconductors as part of a bid to impose tariffs on both sectors on national security grounds, notices posted to the Federal Register on Monday showed.


With all of the bickering about various tariffs, I do feel these two sectors, in particular, make sense to encourage domestic production.

There could be legitimate concerns about being beholden to other countries in terms of our supply for medicine and semiconductors.

RE: Pharma
Why do you think these are imported from abroad? Is it because American Big Pharma is massively overcharging and relatively inefficient? All tariffs will do is give free rein to local American manufacturers to overcharge American consumers, thus reducing health outcomes in a country which is already behind the curve when it comes to standards.

RE: Chips
Ditto - with the added complication of the rare earth supply not being available since China's export ban and all the economies of scales and advantages of location remaining in Asia (Taiwan, South Korea and Japan)

In the long run, it makes strategic sense to make your own stuff, but in both these cases, the cost to the American consumer is prohibitive in the short to medium term and possibly in the long term also, without serious reform of the health sector.

 

[Hans Blaster]

RE: Pharma
Why do you think these are imported from abroad? Is it because American Big Pharma is massively overcharging and relatively inefficient? All tariffs will do is give free rein to local American manufacturers to overcharge American consumers, thus reducing health outcomes in a country which is already behind the curve when it comes to standards.

From my understanding, a lot of this is precursor chemicals and (cheaper) generics.

RE: Chips
Ditto - with the added complication of the rare earth supply not being available since China's export ban and all the economies of scales and advantages of location remaining in Asia (Taiwan, South Korea and Japan)

Chips aren't made with rare earth elements. They are made from silicon wafers and silicon is one of the most abundant elements on Earth (alongside oxygen and iron). If you want to worry about chips, then worry about silicon wafer manufacturing (a complex and demanding process), not materials.

In the long run, it makes strategic sense to make your own stuff, but in both these cases, the cost to the American consumer is prohibitive in the short to medium term and possibly in the long term also, without serious reform of the health sector.

Tariffs aren't going to magically change anything on either. Industrial policy is what is required. Now only if there was a law promoting the manufacturing of "CHIPS" or something.

 

[mindlight]

From my understanding, a lot of this is precursor chemicals and (cheaper) generics.

Or maybe because, unlike in Europe, where you have strong public health services, there is a lack of control by government on stupid pricing, and in the fragmented American market health providers lack the collective bargaining power to get good deals.

Chips aren't made with rare earth elements. They are made from silicon wafers and silicon is one of the most abundant elements on Earth (alongside oxygen and iron). If you want to worry about chips, then worry about silicon wafer manufacturing (a complex and demanding process), not materials.

Chip manufacturing is heavily reliant on rare earths. Ask ASML, who create the lithographic inscription machines that write the transistors onto those silicon wafers. Also, REEs are used in the chips that need a magnetic component, like electric car & AI chips, for example. REEs preserve the purity and integrity of chips and also allow a greater resistance to intense heat on some of the highest performing chips.

America has managed to shoot itself in both feet at the same time when it comes to chip manufacturers. China has a monopoly on crucial rare earths. The Europeans have the best lithographic machines, and 90% of the highest-performance chips are manufactured in Taiwan. Trump is attacking all three pillars of the chip industry at the same time. It has been nice talking to you, but when your computer breaks, I wonder if you will be able to continue the conversation without replacement laptops or smartphones.

Tariffs aren't going to magically change anything on either. Industrial policy is what is required. Now only if there was a law promoting the manufacturing of "CHIPS" or something.

If America wants independence, then in the long run, that might be good for everyone, as there would be more competition in the global market, and prices should go down as a result. But to beat the Chinese, you need to defend Taiwan, develop your sources of rare earths and the industries that process them, build machines comparable to ASML, or at least make friends with the Dutch so that you can buy them from them. Trump's proposals could simply create white elephants that quickly go bust when the government loses interest unless the approach is systematic, like that of the Chinese.

 

[mindlight]

Suppose you are on a drug that basically extends your life. This means that without it you are at high risk of heart attack, blood clot, an immune system out of control, diabetes or other any other condition that will spin you out of control if you do not get the medication/treatments that you have been reliant on. Others too need drugs to help them function, they are unlikely to die but they are nowhere near 100%.
In a wartime situation you can't depend on any shipments from anywhere. Trade might be too difficult even if countries were willing to send such supplies. If the enemy is your old supplier, then forget it. So the USA needs to increase manufacturing not just for making the drugs but also the raw materials that go into them. To me this is a no brainer.
I will offer a second reason to manufacture in the USA. While generics are touted as being safe as the name brand drug the FDA allows 20% variance in the active ingredient. Most only vary 3% or so, but some drugs that need tighter tolerances to the targeted dose can vary more. Testing too on the absorption rates and other characteristics are not always performed on generics and their inactive ingredients or fillers can cause side effects. Here is a Harvard Study that shows higher ER visits from generics versus name brand drugs. Do generic drugs compromise on quality? - Harvard Health
Most generics come from China and India. Not only is the tap water questionable, but so are other raw materials, hygiene and overall factory cleanliness and quality. Yes, the USA can also have shoddy workmanship, but we could expect better overall quality because the FDA is better than many other exporting nations safety agencies. Here is a quote from the FDA.
"On April 24, 2008, during Senate hearings on the heparin fiasco, Janet Woodcock, MD, the Director of the FDA's Center for Drug Evaluation and Research (CDER), testified before the Senate Education, Labor, Health, and Pensions Committee, and stated, "We cannot be the quality-control unit for the world." She also said that the increasingly large number of pharmaceutical ingredients manufactured abroad makes it nearly impossible for the agency to ensure the safety of all drugs sold in the United States." FDA Inspection of Foreign Drug Companies
So let's make sure on drugs in the USA. Bring the jobs back and help our security and health. US productivity would be far higher and I don't think that manufacturing drugs consume huge amounts of labor but if prices increased slightly on generics then we all should be glad to accept them if we assume our quality and more secure supply can improve.

The key with generics is the regulation and the price. If India makes them cheaper, that is a good thing, but the manufacturing process and final product have to be regulated. Both the EU and the FDA, on behalf of the USA, do this quite effectively. Reshoring generic production will only add to costs. Stockpiling is an answer to the wartime scenario, these things are not space intensive.

 

[Laodicean60]

COVID showed me that we were a bunch of idiots. Masks, ventilators, and I think even some drugs. If I was a Chinaman and the US angered me enough I'd have small amounts of poison put in the medicine and with chronic use would cause death but they are doing good job with fentanal.

 

[Hans Blaster]

Or maybe because, unlike in Europe, where you have strong public health services, there is a lack of control by government on stupid pricing, and in the fragmented American market health providers lack the collective bargaining power to get good deals.

This isn't about public health financing.

Chip manufacturing is heavily reliant on rare earths. Ask ASML, who create the lithographic inscription machines that write the transistors onto those silicon wafers.

Chip fabs need to purchase their machines, not build them.

Also, REEs are used in the chips that need a magnetic component, like electric car & AI chips, for example.

Why would a computational element need a "magnetic componenet"?

REEs preserve the purity and integrity of chips and also allow a greater resistance to intense heat on some of the highest performing chips.

America has managed to shoot itself in both feet at the same time when it comes to chip manufacturers. China has a monopoly on crucial rare earths. The Europeans have the best lithographic machines, and 90% of the highest-performance chips are manufactured in Taiwan. Trump is attacking all three pillars of the chip industry at the same time. It has been nice talking to you, but when your computer breaks, I wonder if you will be able to continue the conversation without replacement laptops or smartphones.

If America wants independence, then in the long run, that might be good for everyone, as there would be more competition in the global market, and prices should go down as a result. But to beat the Chinese, you need to defend Taiwan, develop your sources of rare earths and the industries that process them, build machines comparable to ASML, or at least make friends with the Dutch so that you can buy them from them. Trump's proposals could simply create white elephants that quickly go bust when the government loses interest unless the approach is systematic, like that of the Chinese.

 

[Laodicean60]

Chips aren't made with rare earth elements. They are made from silicon wafers and silicon is one of the most abundant elements on Earth (alongside oxygen and iron). If you want to worry about chips, then worry about silicon wafer manufacturing (a complex and demanding process), not materials.

This is a simpleton explanation.

What raw materials are needed for semiconductors?​

Semiconductors are made from a variety of raw materials, including silicon, germanium, gallium arsenide, and indium phosphide. These materials are processed and purified to create a crystalline structure, which forms the foundation for building semiconductor devices such as transistors, diodes, and integrated circuits.

Other raw materials used in the manufacture of semiconductors include impurities such as boron and phosphorus for doping, as well as metals for interconnects, insulators for isolation, and various chemicals for cleaning and etching.

Semiconductor Manufacturing Process: How are semiconductor chips made?

Other raw materials used in the manufacture of semiconductors include impurities such as boron and phosphorus for doping, as well as metals for interconnects, insulators for isolation, and various ...

www.mrlcg.com

 

[mindlight]

This isn't about public health financing.

Chip fabs need to purchase their machines, not build them.

Why would a computational element need a "magnetic componenet"?

Drug pricing is a crucial component of reshoring discussions, and Big Pharma is having a field day because you do not have a large enough public body to moderate bad prices and bad behavior among producers. Your supplier-consumer relationship is out of whack.

You can do the Google search yourself, but here, for example:

In general, prescription drug prices are significantly higher in the United States compared to Germany. U.S. prices can be 2.78 to 3.22 times higher than those in other OECD countries, including Germany

Buy American is definitely not the way forward for affordable health care, at least not without fundamental reforms that no one is going to make. The FDA is already in place for quality control, so given the handicap of Big Pharma reshoring is just expensive and unnecessary in this case.

You cannot make chips without the lithographic inscribers. Right now, the only good ones are made by ASML, so go easy on the Dutch. These machines are very expensive and it is doubtful you will develop the economies of scale in chip production to compete with the Taiwanese in anything less than 5 years, so long after Trump is gone.

The magnets in high-performance chips help moderate and stabilize the current storing excess in a magnetic field, they also reduce Electromagnetic interference and in some chips help establish orientation (direction) the compass /up down apps.