Shall We Work to Raise or Lower Drug Prices?

It’s hard to miss the headlines about wild gyrations in financial markets and tariff policies that have been coming in and out of view. We’re doing our best to stay out of those crosscurrents which threaten to become riptides. But the threat to place “a major tariff on pharmaceuticals” is hard to ignore, simply because it could serve to raise drug prices at a time when they are already way too high.

The financial calamities that capricious policies from the White House brought this week to global financial markets may soon cause great pain specifically in the market for medicines.

Adding Fire to a Burning Issue

We are paying close attention to this because of the potential to raise drug prices even higher than they already are. And because prices for obesity medicines are already a big problem. Pharmaceutical industry analyst Umer Raffat said this move could backfire in a big way. He says the industry is likely to respond to tariffs with higher prices:

“They may have to pass on some of the impact as a price increase. There is already a price discrepancy on many drugs between US vs Europe. Raising prices in US will add more fire to this burning issue.”

A Pivot Point

Eli Lilly makes Mounjaro and Zepbound – two drugs that are transforming the lives of people who can afford them. But unfortunately, many people cannot, because their prices are so high and insurance coverage is so poor. CEO David Ricks cautioned that major new tariffs on medicines could have far-reaching consequences:

“We don’t support tariffs, to be clear. In pharma, about 70% of global R&D takes place in the United States. So we’re creating the next generation of breakthroughs and cures.

“We can’t breach those agreements [for contract prices] so we have to eat the cost of the tariffs and make trade offs within our own companies. Typically that will be in reduction of staff or research and development and I predict R&D will come first. That’s a disappointing outcome.”

Ever More Chaos

We are seeing chaos spread through many dimensions of health and health sciences. Researchers are losing hope for their careers in academic health science. Now it looks like private health science enterprises are facing a major threat.

If this is what winning looks like, we are definitely now tired of it. Make no mistake. The government should be acting to lower, not raise drug prices. It feels like we are on the brink of a big mistake that will hurt many people.

Click here, here, and here for more on the threat of drug tariffs and higher drug prices.

Peoples Drugstore in Washington, DC, photograph from the Library of Congress National Photo Company collection / Wikimedia Commons

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April 11, 2025