WARREN, Mich. (WXYZ) — The tariff tensions continue to escalate. China announced it will impose 125% tariffs on goods starting Saturday.
The increase is in response to President Donald Trump's 145% tariff on Chinese imports.
The impact of those Chinese tariffs could be significant on generic drugs, which make up about 90% of medicines prescribed in America, and most of the ingredients are made in China and India.
“I would say maybe six months down the line, you could see a 15% increase in the cost of your drugs,” Ghada Abdallah pharmacist said. “And it’s not just going to be on the prescription medication because a lot of times, it all factors into your insurance premiums, so it’s going to be added to the health care cost.”
Abdallah is keeping a close eye on potential drug tariffs and the toll they may take on your medicine cabinet and wallet. In addition to potentially driving up costs, tariffs may put increased pressure on some drug companies that source ingredients from overseas and exacerbate shortages of some injectable medications.
“These are generic medications where the (profit) margins are very, very low. So, if they can’t make money selling generic medications that are critical for hospitals, they may just close the factories and say OK, we’re done,” Abdallah said.
Hear more from Pharmacist Ghada Abdallah in the video player below:
While there are still some drugs made in America, domestic manufacturing has shrunk dramatically in recent decades and Trump’s plan with the tariffs is to see a resurgence of it.
“Which is a great plan to bring things back to the U.S. I don’t have anything against that, but the problem that we’re facing is we might not have the talent,” Abdallah said. “As a pharmacist, I went to school in Detroit. I didn’t learn how to make drugs in a factory though.”
“Eighty to ninety percent of our medicine is being made in India and in China, and that’s a national security issue,” Congresswoman Debbie Dingell said. “So, we’ve gotta figure out ways to address these issues that aren’t meat axes. They need to be focused and effective.”
So, is it worth paying more for insurance and prescription medication if it means more of it will be manufactured in America?
“Absolutely,” Janet Tisdale said. “I do take medication for asthma and for it to be made in another country, suppose they got up on Thursday and said OK, we’re not sending anymore. Then what do we do?”
“I’ve been a proponent of bringing the pharmaceuticals back to the United States even if I have to pay more,” Tisdale added. “Anything can happen and if they just decide, you know, they can put something in the medication. Look at the Tylenol thing that happened many years ago.”
“In the long run, if it goes back down, then sure. We should be dependent on our own country. We shouldn’t be dependent on anybody else. But if the cost is going to stay high, then people can’t afford insurance, so I don’t know,” Jennifer Price said.
Abdallah says tariff-induced price hikes for medication may tank some independent pharmacies unless Washington reforms how they’re reimbursed for prescription drugs.
“Pharmaceutical benefit management companies, lots of times... they’re paying the pharmacies below cost for medications, unfortunately, and so really, that’s what’s causing pharmacies to struggle and not be able to stay open. You have pharmacy closures across the country,” Abdallah said.
