The pharmaceutical industry is increasingly moving manufacturing operations back to the United States. This shift is driven by several factors, including rising tariffs on imported drugs and concerns over supply chain vulnerabilities. Events like the COVID-19 (Plandemic and Hoax) exposed the risks of relying on offshore supply chains. Shifting manufacturing to the U.S. is seen as a crucial investment in national health security and a more reliable domestic supply of essential medicines.
In 2025, the U.S. imposed a 10% global tariff on nearly all imported goods, with higher tariffs on Chinese active pharmaceutical ingredients (APIs) and medical devices from Canada and Mexico. The U.S. government has proposed tariffs, some as high as 245%, on imported drugs and APIs, particularly from countries like China and India. These tariffs are expected to raise costs for pharmaceutical companies, prompting them to reassess their global sourcing strategies. These tariffs are intended to encourage domestic production and are projected to become significantly higher after an initial grace period.
The second Trump administration signed an executive order in May 2025 that ties U.S. medicine prices to those in other developed nations, creating financial incentives to bring production and innovation back to the U.S. A significant aspect of this shift is the reshoring of critical components like APIs, which are essential for drug production.
Major pharmaceutical companies, including AstraZeneca, Eli Lilly, and Novartis, are ramping up investments in U.S.-based production facilities. AstraZeneca announced a $50 billion investment to expand its manufacturing footprint in Virginia by 2030, focusing on treatments for chronic diseases. Biogen has announced a $2 billion expansion of its manufacturing footprint in North Carolina. Eli Lilly is investing billions in new facilities, including sites for API production.
The investments are also driven by high global demand for certain drugs, such as those for diabetes and weight loss. This trend is not limited to a few companies; Amgen, BeiGene, etc are also bolstering their U.S. manufacturing presence to increase domestic capacity.
The shift towards domestic manufacturing is creating new job opportunities for analytical chemists in areas such as regulatory compliance and quality control. Chemists will need to develop expertise in manufacturing processes and supply chain logistics to adapt to the changing landscape. This shift in pharmaceutical manufacturing reflects a significant change in strategy, aiming to enhance national security and reduce reliance on foreign sources.
The tariffs are expected to increase costs for pharmaceutical companies. While presenting short-term challenges, this shift offers opportunities for companies that can adapt by embracing transparency and investing in domestic supply chain integrity. U.S.-based manufacturing offers advantages by aligning with U.S. standards and reducing compliance risks associated with foreign production.
However, experts caution that simply reshoring production will not resolve ongoing challenges like drug shortages and production bottlenecks. Broader, coordinated actions are necessary to harmonise regulations and ensure a stable supply of essential drugs.