To: NACDS Chain Members From: Steven C. Anderson, FASAE, CAE, IOM President & Chief Executive Officer Date: April 3, 2026

I am writing to share an update on yesterday’s Presidential Proclamation addressing tariffs on imported pharmaceuticals and pharmaceutical ingredients, and potential impacts for NACDS members and the patients you serve. The proclamation establishes a new tariff framework that differentiates between product types, countries of origin, and company-specific onshoring and pricing commitments.

The effective dates for these new duties are staggered and not immediate. Patented products manufactured by the companies listed in Annex III to the Proclamation may be subject to tariffs beginning July 31, 2026, unless as further detailed below the company has reached an agreement with the Administration that includes MFN pricing and onshoring commitments. All other companies and imports subject to tariffs as a result of the Proclamation will go into effect on September 29, 2026.

Based on NACDS’ review of Annexes II and III to the Proclamation, the following companies have not yet reached an agreement with the Administration that includes both MFN pricing and onshoring, and therefore may be subject to increased tariffs: GlaxoSmithKline LLC and ViiV Healthcare Company; Johnson & Johnson; Pfizer Inc.; and Regeneron Pharmaceuticals, Inc. However, it’s possible some of these companies may take action to avoid tariffs before they take effect. For example, Reuters reported recently that Regeneron is looking to reach a deal with the Administration that could result in tariff relief. Additionally, Pfizer reported in September that they expected to be exempt from 232 pharmaceutical tariffs provided they further invest in manufacturing in the United States, and GSK reported a similar agreement. Johnson & Johnson also announced early this year that a voluntary agreement would result in a tariffs exemption. NACDS will continue to seek clarity on the apparent discrepancy between the Annexes of the Proclamation and prior announcements made by manufacturers.

Key Takeaways for NACDS Members

The most important development from the announcement is that generic drugs, authorized generic drugs, and biosimilars are not subject to tariffs at this time. NACDS will continue to monitor for any future tariff policies that impact generics. Protecting patient access to — and the affordability of — generics has remained a cornerstone of NACDS’ continued advocacy related to pharmaceutical tariffs, as outlined in our initial comments in response to the 232 investigation launch last year. However, tariffs will impact certain patented products, certain companies that have not made MFN pricing and onshoring commitments to the Administration, and country-specific exports as described below.

Targeted Tariffs on Patented Products

• A 100% tariff will apply to certain patented pharmaceutical and API products identified by HTSUS codes listed in Annex I. This represents the highest tier of enforcement and is aimed at specific products deemed critical to national security concerns.
• Based on NACDS’ initial review of these HTSUS codes, it is not immediately apparent which specific products will be impacted. This is because the HTSUS codes corresponding to a given product reflect product composition and materials, and do not necessarily indicate whether a product is patented. We will continue to monitor developments and seek clarity where possible.

Country-Specific Tariff Rates

• 15% tariff on patented pharmaceuticals and APIs imported from the European Union, Japan, Switzerland, Liechtenstein, and South Korea.

• 0% tariff on patented pharmaceuticals and APIs imported from the United Kingdom until January 19, 2029, pursuant to the pharmaceutical pricing agreement reached between the United States and the United Kingdom.

Onshoring and MFN Incentives and Penalties

• 20% tariff on patented products from companies with approved or in-principle onshoring agreements with the Department of Commerce, increasing to 100% by 2030 if conditions are not met.
• Conversely, 0% tariffs apply until January 20, 2029, to the 13 companies listed in Annex II that:
  • Have committed to onshoring, and
    
  • Have entered into Most-Favored-Nation (MFN) pharmaceutical pricing agreements with HHS.
• Note that MFN pricing commitments are essential to qualifying for a 0% tariff rate. If a company only agrees to onshoring, then the 20% rate would apply.
• If a company qualifies for a reduced tariff rate (i.e., 20% or 0%), then that tariff rate would apply to all patented pharmaceuticals and APIs imported by that company.

Additional Considerations

• Lowest Applicable Tariff Rule: Where a product falls into multiple of the categories listed above, the lowest applicable tariff rate will apply, providing some mitigation in overlapping scenarios (e.g., if a product is imported from Switzerland, but is being imported by a company with an onshoring commitment and an MFN agreement, the duty would be 0%, not 15%).

• Exemptions for Critical and Specialty Products: A 0% tariff applies to a range of critical and specialized products, including orphan drugs, animal drugs, and other specialty products deemed to meet an urgent health need or tied to pending trade agreements.

• U.S.-Based Origin Products: Imports of United States-origin pharmaceutical products shall not be subject to the tariffs imposed by this proclamation at this time.

• Compliance and Next Steps: The Secretary of Commerce, in consultation with HHS, will establish and publish the criteria for “qualifying onshoring plans” in the Federal Register. Companies will be required to submit periodic progress reports, which may be subject to external audits.

Potential Impacts & Next Steps: As NACDS members consider potential impacts, pharmacies may want to consider taking the following steps to assess the scope and impact of these tariffs:

1. Assess what branded drugs are dispensed at high volumes across your enterprise. These products (if patented) may represent the highest cost centers associated with these new tariffs.
2. Determine whether the manufacturers of those drugs are subject to 0% tariffs or a different tariff rate.
3. To the extent possible, identify the countries of origin for branded drugs dispensed at high volumes, and determine whether they originate from a country that qualifies for a reduced tariff rate (e.g., U.K., Switzerland, EU, Japan, etc.).
4. Review your analysis with respective manufacturers to confirm or clarify potential impacts, and verify whether certain branded drugs are patented.

As you know, NACDS has continued to stay actively engaged in monitoring related developments and will keep members informed. NACDS is planning an upcoming educational session for members on this important topic. Additionally, the NACDS Annual Meeting is a great opportunity to talk to your pharmaceutical and OTC suppliers about the potential impact of tariffs in the second half of this year.

If you have questions or are seeing impacts in your pharmacy, we encourage you to share your feedback with us.

Thank you for all that you do to serve your communities.