Tariffs and trade barriers

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454 paragraphs · Pharmaceutical Preparations show all sectors

In addition to the pricing mechanisms established under the IRA, governments and other payers may pursue or implement additional approaches intended to reduce pharmaceutical costs, including arrangements or frameworks that reference international prices, most-favored-nation (MFN) concepts, or other comparative pricing methodologies. Such approaches may be implemented through legislation, regulation, administrative action, negotiated arrangements, or other means, and their scope, structure, and application may continue to evolve. In January 2026, AbbVie entered into a voluntary agreement with the United States government to provide certain pricing concessions and U.S.-based research and development and capital investments in exchange for exemptions from tariffs and future pricing mandates during the three-year agreement period. In addition, our pricing concessions and expansion of direct-to-patient offerings may subject AbbVie to new pricing or reimbursement policies that could affect our commercial performance.

Read in the 10-K filed Feb 20, 2026 ↗

Trade restrictions, tariffs, and other changes in global trade policy could increase costs, disrupt supply chains, and adversely affect AbbVie’s business and results of operations.

Read in the 10-K filed Feb 20, 2026 ↗

AbbVie operates in a global environment and relies on complex international supply chains for the development, manufacture, and distribution of its products, including the sourcing of active pharmaceutical ingredients and key materials. Changes in global trade policy, including the potential imposition of import or export tariffs, trade restrictions, or other measures affecting pharmaceutical products or related inputs, could increase manufacturing and procurement costs, reduce margins or disrupt supply continuity. If AbbVie is unable to substantially mitigate or offset increased costs or disruptions resulting from such measures through pricing adjustments, operational changes, or alternative sourcing arrangements, it may have an adverse effect on AbbVie’s business and results of operations.

Read in the 10-K filed Feb 20, 2026 ↗

As a global healthcare company with sales outside of the U.S. making up approximately 61 percent of Abbott’s net sales in 2025, Abbott’s business is subject to geopolitical and macroeconomic risks that are beyond its control. These risks include the enactment of trade protection measures such as tariffs, import or export licensing requirements, other governmental restrictions such as trade sanctions, and changes to international trade agreements; government actions such as price controls, limitations on participation in local enterprises, expropriation, and nationalization; restrictions on local currency conversion and/or cash extraction; changes in inflation (including the cost of raw materials, labor, commodities, and supplies) and interest rates; and fluctuations in foreign currency exchange rates. Abbott is also subject to other geopolitical risks, such as war, political and geopolitical instability, terrorist attacks and related military action.

Read in the 10-K filed Feb 20, 2026 ↗

In December 2025, we announced the U.S. Government Agreement pursuant to which we agreed to, among other things: (i) provide Eliquis for free to the Medicaid program effective January 1, 2026; (ii) donate more than seven tons of Eliquis API to fill the U.S. Strategic Active Ingredient Reserve; (iii) enable direct-to-patient access to Sotyktu, Zeposia, Reyataz, Baraclude and Orencia for cash-paying patients at discounts approximately 80% off current list prices; (iv) adopt a more balanced pricing approach for new launches across developed nations; and (v) continue to expand domestic production. In accordance with the U.S. Government Agreement, BMS will receive certain U.S. tariff relief until January 2029 and will not be subject to future pricing mandates in the United States, however, such exemptions may be terminated or may not be extended. We remain subject to any current or future pricing mandates implemented outside of the United States, and it is possible that current or future pricing regulations may result in a material impact on our business and results of operations. This agreement, and any potential future agreements with government entities, by us or our competitors, could result in reduced prices and reimbursement for certain of our or competing products and may impact our cash flows and results of operations.

Read in the 10-K filed Feb 11, 2026 ↗

The U.S. and other countries have recently imposed, and may continue to impose, new tariffs. While pharmaceuticals are largely exempt from the tariffs imposed in 2025, such exemptions may be terminated or may not apply to any future tariffs. In accordance with the U.S. Government Agreement, BMS will receive certain U.S. tariff relief until January 2029. We continue to evaluate the impacts of tariffs on our business and results of operations, and it is possible that such tariffs, or future tariffs, may result in a material impact on our business and results of operations.

Read in the 10-K filed Feb 11, 2026 ↗

External environmental factors have also caused, and in the future may cause, delays in, and/or increase costs related to, distribution of our medicines, the construction or other acquisition of additional manufacturing capacity, procurement activity, and supplier or contract manufacturer arrangements. Relevant external environmental factors include (i) tariffs, (ii) cost inflation and global transportation and logistics challenges; (iii) labor market dynamics; (iv) natural disasters (including increased instances or severity of natural disasters or other events that may be due to climate change); (v) public health outbreaks, epidemics, or pandemics; (vi) periods of uneven economic growth or downturns; and (vii) the emergence or escalation of, or responses to international tension and conflicts.

Read in the 10-K filed Feb 12, 2026 ↗

Significant portions of our business are conducted in Europe, Asia, and other international geographies. Our global operations and complex supply chain expose us to legislation and regulatory action in or regarding foreign jurisdictions as well as geopolitical and other cross-border risks. Trade and other global disputes, interruptions, and developments, including those related to tariffs, trade protection measures, import or export licensing requirements or disagreements with authorities regarding tariff classifications, transfer pricing, or valuations, the imposition of trade sanctions or similar restrictions by the U.S. or other governments, international tension and conflicts, as well as economic stagnation, cost inflation, strains on global transportation, manufacturing, and labor markets, and public health outbreaks, epidemics, or pandemics affect our ability to do business and, in some cases, result in financial, operational, legal, business, or reputational harm. Among other risks, the use of tariffs and other trade restrictions may increase costs, impact clinical trials or sales of our products, result in supply disruptions or delays, or otherwise complicate aspects of our business. In 2025, the U.S. and other countries imposed or reached alignment on new tariffs. In some cases, imposed tariffs have been paused but may come into effect quickly and unpredictably. While pharmaceuticals are exempt from certain of these tariffs, such exemptions may be terminated or may not apply to any future tariffs.

Read in the 10-K filed Feb 12, 2026 ↗

Moreover, tensions between the U.S. and China, which have already led to a series of tariffs and sanctions, as well as other business restrictions, could further escalate based on additional trade restrictions, retaliation thereto, or otherwise, which could significantly impact our business, including by increasing scrutiny of, or restrictions on, market access, operations, and business development transactions. See Item 1A, "Risk Factors—Risks Related to Our Operations—Reliance on third-party relationships and outsourcing arrangements could adversely affect our business," for additional information. The precise impact of tariffs, trade protection measures, and other restrictions may depend on their ultimate scope, timing, and other factors. If enacted, additional restrictions could result in supply disruptions or delays, further increase costs, or otherwise have a negative impact on our business. Given the nature of pharmaceutical regulation and commercialization, we may not be able to offset the burden of increased costs from tariffs and related impacts to any meaningful degree.

Read in the 10-K filed Feb 12, 2026 ↗

We face risks associated with tariffs and other trade restrictions, which may have a material adverse impact on our results of operations and financial condition.

Read in the 10-K filed Feb 4, 2026 ↗

The United States has recently imposed significant tariffs on imports from other countries, including a baseline tariff of 10% on imports into the United States and higher tariffs on multiple designated countries, such as "reciprocal" tariffs at varying rates. Such tariffs have prompted retaliatory measures from several countries, which may further escalate. Certain of these tariffs have been subsequently paused or modified, and the situation remains fluid. While pharmaceutical products are currently excluded from the baseline and "reciprocal" tariffs imposed by the United States, such tariffs still apply to the raw materials and other products necessary for the manufacture and formulation of our marketed products and product candidates. In addition, the U.S. Department of Commerce has initiated an investigation under Section 232 of the Trade Expansion Act of 1962, as amended, to determine the effects of importing pharmaceuticals and pharmaceutical ingredients on national security. This investigation may lead to the imposition of tariffs on pharmaceutical imports, consistent with the current U.S. administration's stated policy objective of reshoring pharmaceutical manufacturing to the United States. Further, in July 2025, the United States and the EU announced the framework of a trade agreement that generally imposes a 15% tariff on imports from the EU. Under this agreement, pharmaceutical products would not be subject to any future Section 232 investigation duties in excess of this 15% rate. The U.S. Supreme Court is currently considering legal challenges to tariffs imposed under the International Emergency Economic Powers Act, such as the baseline and reciprocal tariffs discussed above. The outcome of this decision could impact trade agreements entered into by the United States and the wider tariff environment in which we operate.

Read in the 10-K filed Feb 4, 2026 ↗

We face significant risks from the existing tariffs imposed by the United States (such as those discussed above) and potential new tariffs as well as their secondary effects, including other countries' imposition of retaliatory tariffs and non-tariff barriers. Depending on how the existing tariffs are applied and whether additional tariffs are imposed, our products that are manufactured partly or entirely outside of the United States could be subject to tariff duties when they are imported to the United States for further manufacturing, packaging, and/or sale to customers. In addition, like all U.S. importers, our Company could pay more for foreign-sourced inputs, which could adversely affect our operating costs in the United States. Our results of operations and financial condition may be materially adversely affected due to the impact of the foregoing.

Read in the 10-K filed Feb 4, 2026 ↗

◦The imposition of tariffs on, or other trade restrictions or domestic sourcing requirements in, the territories and countries where we, our partners, suppliers, or customers do business, as well as any retaliatory actions

Read in the 10-K filed Feb 26, 2026 ↗

The U.S. has imposed or is considering imposing tariffs on certain imports from other countries, including pharmaceutical products, ingredients and inputs, which could significantly impact our cost of doing business. The imposition of adopted, new, announced or proposed tariffs, trade restrictions or domestic sourcing requirements on pharmaceutical imports, including but not limited to products, ingredients, and inputs (such as API), could result in increased costs of goods and prices, disruptions to our supply chain, manufacturing delays, supply shortages, and adverse impacts to clinical trials. These measures could also result in decreased profit margins on certain of our products. Decreased or negative profit margins have in the past, and could in the future, make the production of certain of our products unsustainable, thereby reducing our net sales as well as access for patients.

Read in the 10-K filed Feb 26, 2026 ↗

In addition, we may be restricted in our ability to adapt, or may be unable or unsuccessful in adapting, to these impacts and challenges due to, among other things, the terms of our current customer, supply or distribution agreements, or the need to obtain regulatory approval prior to making any changes to our manufacturing locations, processes or suppliers. Existing, announced, and future tariffs, trade agreements, or domestic sourcing requirements, as well as potential exemptions, could also provide our competitors with an advantage to the extent such future impacts disproportionately affect us compared with them.

Read in the 10-K filed Feb 26, 2026 ↗

The impact of any adopted, announced, new or proposed tariffs, trade restrictions or domestic sourcing requirements on our business continues to be subject to a number of factors that we cannot predict, including, but not limited to, the scope, nature, amount, effective date and duration of any such measures. Furthermore, general uncertainty related to adopted, new or potential tariffs, trade restrictions and domestic sourcing requirements has in the past reduced and could in the future further reduce global economic activity, thereby resulting in additional adverse impacts to us.

Read in the 10-K filed Feb 26, 2026 ↗

Changes in trade policies, including the imposition of tariffs, sanctions, and other trade restrictions, may adversely affect our business.

Read in the 10-K filed Feb 12, 2026 ↗

Current or future tariffs or other restrictive trade measures may raise the costs of raw materials, components or finished goods, which may adversely impact both our product offerings and our operational expenses. Our manufacturers, suppliers and distribution channels may also experience supply chain disruptions as a result of increased costs and uncertainty. Duties are assessed based on import value. Each jurisdiction applies its own rules and procedures for import valuation, increasing the complexity and risk of errors. While we maintain procedures to ensure compliance, there is no guarantee these will prevent all errors, and regulatory changes may heighten this risk.

Read in the 10-K filed Feb 12, 2026 ↗

Additional tariffs and other trade restrictions could result in a negative perception and/or an increased cost of goods and higher prices which may reduce demand for products and services, or extended sales cycles as customers assess the impact of evolving trade policies on their operations and face increased costs or decreased revenue. Additionally, a number of our customers, particularly U.S.-based livestock producers, benefit from free trade agreements, the loss of which could impact their operating results and spending power. Tariff and other trade-related cost pressures and supply chain disruptions may lead to reputational harm if we are unable to deliver products or services on expected timelines or if any price increases are poorly received by customers or business partners.

Read in the 10-K filed Feb 12, 2026 ↗