During a recent conversation with key figures from American pharmaceutical groups, President Donald Trump issued a clear mandate: bring overseas production back to the United States to avoid import tariffs on their drug supply. The latest report from Bloomberg highlights this escalating pressure on the pharmaceutical industry, which has already been under the spotlight following Trump’s announcement of potential tariffs on a range of imports, including cars, computer chips, and pharmaceutical products, with a rate of around 25%.

Trump’s directive is part of a broader strategy to reduce trade deficits and ensure domestic production, particularly in critical sectors like healthcare. The move follows his administration’s emphasis on “America First” policies, which include imposing tariffs and re-negotiating trade agreements to bring manufacturing jobs back to the U.S.

Among the key figures present during Trump’s meeting was Albert Bourla, the CEO of Pfizer, a giant in the pharmaceutical industry. Pfizer has been a significant contributor to the U.S. economy, particularly with its large investments in its production sites, including Puurs-Sint-Amands in Belgium, which has become one of the largest pharmaceutical production sites in Europe.

The introduction of potential import tariffs has raised concerns within the industry, particularly for companies like Pfizer that have substantial operational bases in Europe. Bourla, aware of the potential impact, immediately pointed out that Pfizer could be vulnerable due to its extensive presence in Europe. Pfzier currently operates around a dozen production sites in Europe, with the largest in Puurs-Sint-Amands. He stated “We are considerably exposed in Europe,” and if you ask what I’m thinking I think climate alone in Europe would help a lot,” suggesting that the climate would play a significant role on where these kind of activities are performed.

Thousands of Jobs at Stake

Pharma.be, the Belgian federation of the pharmaceutical industry, has expressed significant concern about the potential implications of Trump’s announcement. “We are very delicate and sensitive in Belgium and more particularly than our jobs,” says head Caroline Ven, “We are very sensitive in Belgium and more particularly in Pharma.be.”

This concern is justified, given the critical role of the pharmaceutical industry in Belgium’s economy. Caroline Ven explained, “Belgium is a very important companion so we are very sensitive in Belgium. Much of the pharmaceutical production in Belgium is exported, especially to the United States. Four to five thousand jobs in our country are linked to pharmaceutical companies.” He also mentioned vaccination, highlighting Belgium’s importance in exporting vaccines to the US, with 40 percent of all vaccines produced in the country going to the United States. Belgium is home to both Pfizer and GSK (GlaxoSmithKline), a further example of pharmaceutical companies with multiple locations.

The statistics speak for themselves. Belgium’s pharmaceutical output in 2024, for the first ten months, reached approximately 67 billion euros. Out of this, nearly a quarter (24%) was destined for the U.S. market. This underlines the pivotal role of the U.S. as a key market for Belgian pharmaceutical exports, particularly in the vaccine sector, where 40% of all vaccines produced are sent to the U.S. Pfizer and GlaxoSmithKline represent just two major players in Belgium, each responsible for more than 5,000 jobs.

Beyond American Companies

The Belgian pharmaceutical industry is not solely dependent on American companies. Many firms have their roots in other countries – within Europe and beyond, such as Japan. The country is also home to global pharmaceutical companies like UCB, which have a significant presence worldwide.

Uncertainty and Relocation Concerns

Ven cautions that companies will not move their operations overnight, highlighting the complexities involved:

You can’t just move what is there. We have major investment decisions in hand. Over 5.7 billion euros in research and development in our country. And let’s take into consideration the important role that Belgium has within Europe in phase one, phase two and phase three clinical testing of candidate medicines. We can’t just move these networks very easily from one day to the next. The main difficulty in moving is the ability to recognise the most sensitive subject to the local population.

She also expressed concerns about the impact on the investment climate in Belgium. While recognizing the temporary nature of the measures, Ven worries that Trump’s pressure could influence future investment decisions.

The situation suggests stepping up efforts to engage with policymakers in the U.S. And Belgium on the investments needed in important treatments, such as cell and gene therapies on the public health problems that might emerge. While cell and gene therapies are primarily being developed in the U.S. and Asia, Europe and Belgium risk missing out due to the potential escalation of a trade war. This could adversely affect the continent’s ability to attract investments in these critical areas, leading to potential long-term consequences for medical innovation and public health.

Economic Implications

For the Belgian economy, this is a worrisome outlook. The pharmaceutical sector has been one of the fastest-growing industries in the country. Employment in this sector rose 19% from 2018 to 2023, while exports increased by 55% during the same period. If the export of Covid vaccines is factored in, the increase is more than 80%. This sector accounts for 15% of the total exports from Belgium and is responsible for 56% of the country’s trade surplus, indicating its significant contribution to the economy.

Pharma.be’s Call for Action

Ven has called for dialogue and consultation with governments at all levels in Belgium to ensure the future strength of the Belgian pharmaceutical sector, quarantining from import rates, to avoid a slowdown. She emphasized, “That is why we request from Pharma.be to have a discussion to creating consultative mechanisms in discussion with world leaders in Europe and the U.S. and on ways to strengthen this important sector.” As Belgium struggles with the potential fallout of Trump’s trade policies, the industry’s future hangs in the balance, and stakeholders hope that strategic planning and international cooperation can mitigate the risks and ensure sustained growth.