Meanwhile, President Trump continues to push reciprocal levies and reshoring efforts, while pharma prepares for escalating costs.
The European Union intends to impose a 30% tariff on US imports valued at $117 billion if a trade deal is not reached, and if President Trump ends up enacting that same rate on the EU at the beginning of next month, per Bloomberg.1 Items include cars manufactured in the United States, bourbon whiskey, and Boeing aircraft.
The EU plans tariffs on various US products into one bundle.
Although it hasn’t been activated as of this time, the idea of invoking the EU’s anti-coercion instrument (ACI) has been circulating, which would come into play during a no-deal scenario. According to Crowell & Moring LLP,2 “the ACI provides a legal framework for a centralized and structured EU response to third country “coercion” through diplomatic means and, failing that, through any counter measures deemed necessary. The ACI states that one of its objectives is to ensure its responses are always in strict adherence to internal and international legality.”
In essence, if a deal isn’t reached, the EU could consider launching various retaliatory actions—via the limitation of US investments and taxes on US tech companies. A majority from EU member states would be needed, however.
The United States has requested a “near-universal” tariff on EU goods higher than 10%, with exemptions pertaining to various medical devices, aviation, some medical devices, manufacturing equipment, some spirits, and generic medications.
This comes as the US finalized an agreement with Japan requiring American importers to pay a 15% reciprocal levy on Japanese exports to the United States, including autos and their parts.3
Meanwhile, the pharmaceutical industry continues to prepare for levies by the beginning of next month, which could coincide with the planned reciprocal tariffs rates that were previously set.4
Trump has described it as being a “low tariff” that would slowly increase over the course of approximately a year, with a tariff reaching up to 200% still being a possibility. Import taxes are vital, says the US president, to not only help guide the reshoring of manufacturing efforts back to the United States, but also contribute to financially supporting the “Big, Beautiful Bill” that he had signed on the Fourth of July. The bill builds on the 2017 Tax Cuts and Jobs Act, making most tax reductions permanent while raising funding for border security, defense, and energy production.
Many companies have already been in the process of reshoring manufacturing to the United States to avoid the impending tariffs, including AstraZeneca, who plans to invest $50 billion by 2030 in US-based drug manufacturing and R&D, marking its largest single manufacturing investment globally.5 The announcement is headlined by a new state-of-the-art facility in Virginia that will produce active pharmaceutical ingredients (APIs) for weight management and metabolic treatments, leveraging AI, automation, and data analytics.
“Today’s announcement underpins our belief in America’s innovation in biopharmaceuticals and our commitment to the millions of patients who need our medicines in America and globally,” said AstraZeneca CEO Pascal Soriot at the time that the news broke. “It will also support our ambition to reach $80 billion in revenue by 2030. I look forward to partnering with Governor Youngkin and his team to work on our largest single manufacturing investment ever. It reflects the Commonwealth of Virginia’s desire to create highly-skilled jobs in science and technology, and will strengthen the country’s domestic supply chain for medicines.”
References
1. Delfs A, Nardelli A, Valero J. EU Readies €100 Billion No-Deal Plan to Match US 30% Tariff. Bloomberg. July 23, 2025. Accessed July 23, 2025.
2. The Anti-Coercion Instrument: What Is It and How Europe Might Use It Over the Next Four Years. Crowell & Moring LLP. Accessed July 23, 2025.
3. Dlouhy JA, Wingrove J, Nohara Y. Trump Strikes Deal With Ally Japan Setting Tariff Rate at 15%. Bloomberg. July 22, 2025. Accessed July 23, 2025.
4. Saraceno N. Trump Says Pharma Industry Should Expect Tariffs by Aug. 1. Pharmaceutical Commerce. July 17, 2025. Accessed July 23, 2025.
5. Saraceno N. AstraZeneca Commits $50 Billion to US Manufacturing and R&D Efforts by 2030. Pharmaceutical Commerce. July 22, 2025. Accessed July 23, 2025.
