- Pfizer secured a three-year reprieve from the US tariffs on pharmaceutical imports
- The company will offer drugs at a 50% average discount on the TrumpRx website
- Pfizer also plans a $70-billion investment in the US to support R&D and domestic manufacturing
Pfizer Inc. has secured a three-year reprieve from the tariffs on pharmaceutical imports imposed by US President Donald Trump.
The relief comes as Pfizer entered into a pact with the Trump administration, which will result in the company slashing prices of drugs distributed via the US Medicaid programme, President Donald Trump said in a briefing at the White House.
According to Pfizer Chief Executive Officer Albert Bourla, the three-year grace period from tariffs on pharmaceuticals would lower some of its drug prices.
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In addition, the company will sell some drugs at a 50% average discount on a direct-to-consumer website called TrumpRx. The website allows Americans to pay cash for drugs at discounted rates negotiated by the government.
Pfizer, as part of the deal, will offer across-the-board reductions on drug prices for Americans enrolled in the Medicaid insurance program, Trump said.
Bourla also announced an investment of $70 billion to push on research and development, and to ramp up domestic manufacturing over the next few years.
The shares of Pfizer went up nearly 5% on Tuesday following the deal being unveiled by the White House.
Trump, meanwhile, threatened he will impose additional 5% to 8% tariffs on pharmaceutical companies that have no deal.
As recently as last week, Trump imposed 100% tariffs on the pharmaceutical sector that will come into effect on Oct. 1.
Notably, the US president has repeatedly pressured drugmakers to bring prices in line with other countries.
Trump had also set a deadline of Sept. 29 for major pharmaceutical companies like Pfizer and Johnson & Johnson to reduce their prices. He sent letters to the chief executive officers of major drugmakers, telling them to extend the "most-favored-nation" pricing to Medicaid.
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