News Digest:

The U.S. government has launched formal investigations into imports of pharmaceuticals and semiconductors, laying the groundwork for potential tariffs on national security grounds. According to notices from the Federal Register, these probes are being conducted under Section 232 of the Trade Expansion Act of 1962, which allows the government to impose trade restrictions if imports threaten national security. Public comments will be accepted for 21 days from the publication date, with the investigations to be concluded within 270 days.

Pharmaceuticals and semiconductors were exempt from the initial 10% import tariffs that took effect on April 5, but President Trump indicated that both sectors would face separate levies. He has promised to announce a specific tariff rate for imported chips in the coming days.

The U.S. relies heavily on semiconductor imports from Taiwan. While the Biden administration previously worked to reduce this dependency through the CHIPS Act, Trump’s proposed tariffs could disrupt current supply chains. Similarly, the pharmaceutical industry, particularly generic drugmakers, has raised concerns that new tariffs could lead to higher costs, reduced access, and drug shortages.

John Murphy III, CEO of the Association for Accessible Medicines, warned that tariffs would worsen existing affordability and supply issues. Larger drugmakers may pass increased costs to consumers, while Indian manufacturers, who supply nearly half of U.S. generics, caution that new tariffs could delay investment and hurt patients.

The investigations underscore a broader push to onshore critical industries, though industry experts argue that domestic manufacturing capacity may not be sufficient to meet immediate needs.

End Notes

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