Thu, 03 Apr 2025

Thu, 03 Apr 2025 US pharma boss calls tariffs a 'pivotal moment'

Eli Lilly's CEO has told the BBC that he is doubtful tariffs could bring manufacturing jobs to the US whilst raising billions in tax revenue.
David Ricks, CEO of US pharmaceutical giant Eli Lilly, believes that President Trump's decision to impose tariffs on imports from around the world has marked a significant turning point in US economic history. He described it as a "pivot" in policy, saying it will be difficult for the US to reverse course. Ricks expressed skepticism about the idea that tariffs would create hundreds of billions in additional revenue for the US, but did suggest that some companies might consider relocating manufacturing operations outside the US. Eli Lilly has been exempt from tariffs due to its complex supply chains and life-saving products, but Ricks is uncertain how long this will last. He warned that if tariffs are imposed on pharmaceuticals, it would have a negative impact on investment in new medicines. The CEO stated that drug prices are already capped in Europe and the US, meaning that the cost of tariffs would be absorbed by companies like Eli Lilly. This could lead to staff cuts or reductions in research and development (R&D) expenses, with Ricks predicting that R&D will suffer first. Despite not supporting tariffs, Ricks acknowledged the intention behind them: to encourage companies to keep their production and R&D operations within the US. Eli Lilly is currently building a new $800m facility in Ireland, which will employ over 3,000 people. However, the company's investment in the UK has been declining, with Ricks citing slow regulation and poor uptake of new medicines as threats to the UK's reputation as a life sciences hub. Ricks delivered candid warnings to senior UK ministers about the decline of the country's advantage in life sciences, stating that patients are missing out on advances in medicine due to these issues. He emphasized the need for a strong intellectual property system, efficient regulation, and a commercial market that rewards innovation.
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