‘A tariff would be devastating’: Are we heading for a prescription crisis?
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A dramatic shake-up in global trade policy has sparked fears for one of Australia’s most crucial industries.
A proposed 200 per cent tariff from the United States could bring local pharmaceutical exports to their knees.
Experts have issued a grave warning about what this could mean for the nation’s future access to vital medicines.
The Pharmacy Guild of Australia’s president, Trent Twomey, warned that Australia’s pharmaceutical industry faced collapse if US President Donald Trump followed through on threats to impose a 200 per cent tariff on imports.
Trump announced on 8 July, local time, that the move was designed to bring manufacturing back to the US, adding that the tariffs could be implemented within a year to 18 months.
Formal details of the plan were expected to be revealed by the end of the month.
Pharmaceutical goods currently ranked as Australia’s third-largest export to the US, behind beef and gold.
In 2024 alone, Australia exported around $2.2 billion worth of pharmaceuticals to America.
Twomey said the impact of such a tariff would be devastating, given the US was Australia’s biggest pharmaceutical export market.
‘(The US is our) largest market, so they are going to really struggle,’ he said.
‘You cannot have domestic manufacturing in Australia if you are only relying on 27 million people (as a market). It doesn’t work.’
‘The only way domestic manufacturing works in Australia with our high energy and our high wages, and that’s just a fact, is if we rely on exports, and if the biggest market of our export, the United States, slaps on the tariffs then it just starts to crumble and fall apart.’
‘It means the next time we have a global pandemic, or the next time supply chains start to fracture, other countries will do quite rightly do what they should, they will say “sorry, you can’t export to Australia”, we need that for our domestic and our country goes without.’
‘It is not a price at pharmacy issue; it is more of a sovereign manufacturing issue that we need to protect.’
Twomey said that American pharmaceutical companies were angered by Australia’s Pharmaceutical Benefits Scheme (PBS), which they blamed for undercutting global profits.
‘The first thing you need to realise at home, the price you are charged by your pharmacy is actually going down, not up,’ he said.
‘(The) government slashed the maximum price of medicines from $42 down to $31. It is being slashed again down to $25 on January 1, so you don’t need to worry.’
‘The worry is how much it is going to cost Canberra to import the medications they then sell to you.’
‘The real worry there is that if President Trump forces the companies in America to charge less, that drug company is still going to want to make their global profit.’
‘So, they are going to push the price to charge our taxpayer up.’
‘The real enemy for the Americans is not the Australian PBS system, the real enemy for them is their pharmacy benefit managers over there. They are trillion-dollar middlemen, they are clipping the ticket on the way through.’
‘If Mr Trump is angry, I get it, but he shouldn’t be angry about Australia’s world class PBS, he needs to be angry at the trillion-dollar corporate rip-offs in America, that are charging his citizens more money.’
‘That’s where he needs to direct his anger.’
Twomey stressed that despite the international tension, Australians should not expect to pay more for medicines at the counter.
‘Firstly, the PBS enjoys bipartisan support,’ he said.
‘This is not a football to be kicked around in Canberra. Specifically, to answer your question, only 10 per cent of medicines we have in Australia are manufactured locally.’
‘Now, if we are importing 90 per cent of our medication, we can’t afford to lose that domestic manufacturing capability.’
‘And if those drug companies, like CSL, in Melbourne, are slapped with a 200 per cent tariffs on exports to the United States, that’s going to make their companies unviable here in Australia, if they become solely reliant on the domestic market.’
‘The big risk for that is they manufacture our vaccines.’
He warned that Australia’s response to the COVID-19 pandemic would not have been possible without local production.
‘We would not have been able to get through the global pandemic if we did not have domestic manufacturing, and that really is a national security issue,’ he said.
This latest warning about tariffs exposes a much deeper vulnerability in our healthcare system—the lack of strong local manufacturing.
While trade tensions may feel far removed from everyday life, they directly impact how quickly and reliably we can access essential medicines.
If you’ve ever wondered why we don’t just make more of our own medicines to avoid shortages in the first place, this next story breaks it down clearly.
Read more: Why doesn’t Australia make more medicines? Wouldn’t that fix drug shortages?
A tariff of this scale could damage more than just the pharmaceutical trade—it could leave the country vulnerable in its next time of need.
How much are we willing to gamble on imported supply chains?
A proposed 200 per cent tariff from the United States could bring local pharmaceutical exports to their knees.
Experts have issued a grave warning about what this could mean for the nation’s future access to vital medicines.
The Pharmacy Guild of Australia’s president, Trent Twomey, warned that Australia’s pharmaceutical industry faced collapse if US President Donald Trump followed through on threats to impose a 200 per cent tariff on imports.
Trump announced on 8 July, local time, that the move was designed to bring manufacturing back to the US, adding that the tariffs could be implemented within a year to 18 months.
Formal details of the plan were expected to be revealed by the end of the month.
Trump tariff threat sparks Aussie pharma fears. Image source: Instagram/realdonaldtrump
Pharmaceutical goods currently ranked as Australia’s third-largest export to the US, behind beef and gold.
In 2024 alone, Australia exported around $2.2 billion worth of pharmaceuticals to America.
Twomey said the impact of such a tariff would be devastating, given the US was Australia’s biggest pharmaceutical export market.
‘(The US is our) largest market, so they are going to really struggle,’ he said.
‘You cannot have domestic manufacturing in Australia if you are only relying on 27 million people (as a market). It doesn’t work.’
‘The only way domestic manufacturing works in Australia with our high energy and our high wages, and that’s just a fact, is if we rely on exports, and if the biggest market of our export, the United States, slaps on the tariffs then it just starts to crumble and fall apart.’
‘It means the next time we have a global pandemic, or the next time supply chains start to fracture, other countries will do quite rightly do what they should, they will say “sorry, you can’t export to Australia”, we need that for our domestic and our country goes without.’
‘It is not a price at pharmacy issue; it is more of a sovereign manufacturing issue that we need to protect.’
Twomey said that American pharmaceutical companies were angered by Australia’s Pharmaceutical Benefits Scheme (PBS), which they blamed for undercutting global profits.
‘The first thing you need to realise at home, the price you are charged by your pharmacy is actually going down, not up,’ he said.
‘(The) government slashed the maximum price of medicines from $42 down to $31. It is being slashed again down to $25 on January 1, so you don’t need to worry.’
‘The worry is how much it is going to cost Canberra to import the medications they then sell to you.’
‘The real worry there is that if President Trump forces the companies in America to charge less, that drug company is still going to want to make their global profit.’
‘So, they are going to push the price to charge our taxpayer up.’
‘The real enemy for the Americans is not the Australian PBS system, the real enemy for them is their pharmacy benefit managers over there. They are trillion-dollar middlemen, they are clipping the ticket on the way through.’
‘If Mr Trump is angry, I get it, but he shouldn’t be angry about Australia’s world class PBS, he needs to be angry at the trillion-dollar corporate rip-offs in America, that are charging his citizens more money.’
‘That’s where he needs to direct his anger.’
Twomey stressed that despite the international tension, Australians should not expect to pay more for medicines at the counter.
‘Firstly, the PBS enjoys bipartisan support,’ he said.
‘This is not a football to be kicked around in Canberra. Specifically, to answer your question, only 10 per cent of medicines we have in Australia are manufactured locally.’
‘Now, if we are importing 90 per cent of our medication, we can’t afford to lose that domestic manufacturing capability.’
‘And if those drug companies, like CSL, in Melbourne, are slapped with a 200 per cent tariffs on exports to the United States, that’s going to make their companies unviable here in Australia, if they become solely reliant on the domestic market.’
‘The big risk for that is they manufacture our vaccines.’
He warned that Australia’s response to the COVID-19 pandemic would not have been possible without local production.
‘We would not have been able to get through the global pandemic if we did not have domestic manufacturing, and that really is a national security issue,’ he said.
This latest warning about tariffs exposes a much deeper vulnerability in our healthcare system—the lack of strong local manufacturing.
While trade tensions may feel far removed from everyday life, they directly impact how quickly and reliably we can access essential medicines.
If you’ve ever wondered why we don’t just make more of our own medicines to avoid shortages in the first place, this next story breaks it down clearly.
Read more: Why doesn’t Australia make more medicines? Wouldn’t that fix drug shortages?
A tariff of this scale could damage more than just the pharmaceutical trade—it could leave the country vulnerable in its next time of need.
How much are we willing to gamble on imported supply chains?
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