Pharmaceutical Giants Grapple with China's Trade Tariff Changes

Pharmaceutical companies report tariff exemptions allowing drug imports into China, amidst ongoing trade tensions. Some companies see opportunities, but the impact on profits from high tariffs remains. The tariff changes affect companies such as Johnson & Johnson and Merck, with possible cost absorption or price adjustments required by firms.

In a move that's creating a buzz in the pharmaceutical industry, the Beijing-based American Chamber of Commerce has noted that several companies, particularly in pharmaceuticals, were able to import drugs into China without the usual tariffs over the past week.

Michael Hart, president of the chamber, stated in a recent online press conference that while the exemption was drug-specific and not a blanket sector-wide exemption, it marks a significant breakthrough for companies amid tensions over hefty tariffs. These were originally imposed by China as a response to U.S tariffs leveled under President Donald Trump.

Prominent drugmakers like Johnson & Johnson and Merck are among those impacted, forecasting profit cuts due to such tariffs. Meanwhile, companies with products on China's National Reimbursement Drug List might find themselves bearing the costs or adjusting prices. Jens Eskelund of the European Union Chamber noted the tough choices facing companies with U.S.-based production hubs affected by these tariffs.

(With inputs from agencies.)