How many Canadian-made drugs does the U.S. typically import?

According to a new analysis from the University of Toronto published in JAMA, up to $3 billion in pharmaceuticals used in the U.S. depend on Canadian manufacturing. A 25% tariff on these drugs could add $750 million in cost to the American market, potentially leading to significant disruption in drug supply long-term. Trade tariffs have already been imposed twice on Canadian imports by the current American administration, with products like pharmaceuticals exempted. However, future proposed tariffs would not exempt pharmaceuticals after April 2. “The proposed tariffs could affect a wide range of medications, from antibiotics to mental health treatments,” said Mina Tadrous, lead author and assistant professor, Leslie Dan Faculty of Pharmacy, University of Toronto in a press release from the University. “Straining this supply chain could trigger drug shortages and jeopardize patient care. We know that drugs with only one manufacturer and rapidly shifting supply chains increase the risk of shortages.” Tadrous and his team of researchers looked at drugs manufactured in Canada and exported to the U.S. using data from DailyMed package inserts database and IQVIA’s MIDAS® quarterly sales and volume data. They then assessed the clinical importance of each drug and its shortage history according to the U.S. Food and Drug Administration (FDA) and the American Society of Health-System Pharmacists. Based on this data and their analysis, researchers suggest that pharmaceuticals need to be exempt from tariffs to prevent higher costs and supply disruptions. Researchers also note that while Canada is not the biggest supplier of drugs to the U.S., the tariffs would have a major impact. Pharmaceutical tariffs could also set a concerning precedent and have a larger effect, Tadrous says in the university’s press release. These tariffs could also increase the risk of counter-tariffs from the U.S., which would jeopardize access to medicines for Canadians and worldwide. “Policymakers can leverage other tools or create tax incentives to attract domestic manufacturing, but abruptly applying tariffs to a crucial sector with already strained supply chains is not the way to go. People’s health is at stake.”

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