WASHINGTON — President Trump marked the one-year anniversary of his “Liberation Day” reciprocal tariff announcement with new levies on pharmaceuticals and steel.
Trump signed orders imposing tariffs of up to 100% on foreign-made drugs and requiring steel to be tariffed at its US market value, rather than the lower cost of making it abroad, closing what officials called a loophole.
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The pharmaceutical order is unlikely to affect most popular medicines because the rate drops to 0% for the 13 large companies that have already pledged to both offer federal health programs “most favored nations” pricing and to onshore production to the US.
Smaller drugmakers can reduce their tariff rate to 20% if they partner with US manufacturers and to 0% if they align pricing with rates in other western countries within 180 days.
“Basically, for smaller companies, what they do is they use contract manufacturers,” an official told reporters.
“The big contract manufacturers are building huge factories here, and so they expect to take care of the smaller companies by saying, ‘Look, we’ll build for you your smaller drug.’”
The metals-focused order seeks to both strengthen and clarify enforcement of Trump’s 50% tariff rate on steel, aluminum and copper.
Assessing steel at US market rates prevents undervaluing based on overseas production costs.
“It’s now going to be proper, and fair, as opposed to… people try to get around our tariffs and sort of short-changing us,” the official said.
“That creates a model [where] we will build blast furnaces and electric arc furnaces in America. 25-30 years ago, we had 40 blast furnaces in America. Now we’re down to 10 and we were becoming subservient to others,” he said.
“China just announced an export license regime, so they are thinking of weaponizing steel. We don’t buy consequential massive steel from China. However, the rest of the world does.”
The metals order also clarifies the tariffs on items partially made of aluminum, copper and steel, eliminating the need for complicated computations.
Products whose weight is comprised more than 15% of the metals will be subject to a 25% tariff. Items with a negligible amount won’t face the tariff.
Trump announced the new actions on the anniversary of his Rose Garden event unveiling a 10% baseline tariff on most countries as well as sky-high proposed tariffs on countries with which the US had trade deficits.
The president’s “reciprocal” tariffs forced most major countries into brokering new trade deals that repealed tariffs and non-tariff barriers on US goods.
The Supreme Court in February ruled that Trump’s reciprocal tariffs, his 10% baseline and additional anti-fentanyl tariffs on China, Canada and Mexico were not allowed by an emergency-powers law.
Trump has kept intact pending trade deals by threatening retaliation using different legal authorities and has temporarily imposed a new 15% baseline tariff on nations without a deal.
