The Trump Administration’s impact on global pharmaceuticals

Trump’s presidency has left an indelible mark on the global pharmaceutical sector. His administration’s policy framework, characterised by protectionist trade measures, corporate tax reform, and a renewed “America First” industrial agenda, has redefined how multinational drug manufacturers operate both domestically and internationally.

Prior to his election in 2016, the U.S. pharmaceutical market largely functioned as a free-market system with minimal government price controls. Drug prices were determined by manufacturers, Medicare was prohibited from negotiating lower rates, and the resulting environment fostered strong profitability but growing public criticism over affordability. Consolidation was steady but strategic, with mergers and acquisitions primarily focused on portfolio diversification and access to innovative biotech pipelines.

Since returning to office, President Trump has doubled down on reshoring and cost reduction. Key initiatives include the Most-Favoured-Nation (MFN) pricing framework, aligning U.S. drug prices with those in comparable markets, and a landmark 2025 partnership with Pfizer to launch TrumpRx.gov, offering discounted access to select medicines in exchange for temporary tariff relief. Simultaneously, import tariffs and supply-chain controls have pushed pharmaceutical companies to localise manufacturing, strengthening U.S. production capacity while compressing global margins.

The ripple effects have been acutely felt in the UK. Increased inbound investment from U.S. and global firms has bolstered the UK’s biotech and life sciences clusters, particularly across Oxford, Cambridge, and London. However, pricing pressures in the U.S. have also led pharmaceutical companies to offset losses through higher international prices, tightening budgets for the NHS and other European health systems.

Despite these challenges, the Trump-era environment has stimulated record-breaking deal activity, exemplified by transactions such as Bristol-Myers Squibb’s acquisition of Celgene and AbbVie’s takeover of Allergan. As regulatory landscapes evolve, M&A remains both a defensive and strategic lever for growth.

“In times of political and regulatory upheaval, consolidation becomes not merely a strategy for growth, but a necessity for survival.”

Looking ahead, U.S. policy-driven localisation and pricing reform will continue to shape global pharmaceutical investment. For UK life sciences, this presents a dual-edged opportunity: to attract foreign capital seeking stability, while navigating intensified cost and supply pressures across an increasingly interconnected market.