1 00:00:00,200 --> 00:00:02,680 Speaker 1: Looks like US President Donald Trump will be putting those 2 00:00:02,680 --> 00:00:06,240 Speaker 1: tariffs on medicines. After all, pharmaceuticals were exempted from the 3 00:00:06,280 --> 00:00:09,719 Speaker 1: initial wave of tariffs that went out over the weekend, 4 00:00:09,720 --> 00:00:12,600 Speaker 1: but then US COMMAS Secretary Howard Lutnick said they've only 5 00:00:12,600 --> 00:00:14,520 Speaker 1: been exempted so that the President can put a different 6 00:00:14,560 --> 00:00:15,400 Speaker 1: tariff on them later. 7 00:00:15,600 --> 00:00:19,040 Speaker 2: Well, if you remember, over the past couple of months, 8 00:00:19,280 --> 00:00:24,720 Speaker 2: President Trump has called out pharmaceuticals and semiconductors and autos. 9 00:00:24,720 --> 00:00:29,240 Speaker 2: He called them sector tariffs, and those are not available 10 00:00:29,280 --> 00:00:32,880 Speaker 2: for negotiation. They are just going to be part of 11 00:00:32,920 --> 00:00:37,800 Speaker 2: making sure we re sure the core national security items 12 00:00:38,159 --> 00:00:40,280 Speaker 2: that need to be made in this country. We need 13 00:00:40,320 --> 00:00:43,519 Speaker 2: to make medicine in this country. We learned it during COVID. 14 00:00:43,560 --> 00:00:45,440 Speaker 2: We need to make it in this country now. 15 00:00:45,440 --> 00:00:48,000 Speaker 1: Doctor Graham Jervis is the CEO of Medicines New Zealand 16 00:00:48,000 --> 00:00:48,400 Speaker 1: And with US. 17 00:00:48,400 --> 00:00:50,600 Speaker 3: Hey Graham, how are you? 18 00:00:50,960 --> 00:00:52,479 Speaker 1: I'm very well, thank you. Now, the point of this, 19 00:00:52,600 --> 00:00:55,480 Speaker 1: obviously is to drive the manufacturing from China back to 20 00:00:55,520 --> 00:00:56,960 Speaker 1: the US. Do you reckon it'll work? 21 00:00:58,000 --> 00:01:00,480 Speaker 3: Well, Look, I think it's really too early to tell 22 00:01:00,720 --> 00:01:04,200 Speaker 3: at this stage what will be happening. I think and 23 00:01:04,240 --> 00:01:06,120 Speaker 3: if I can just say to you listeners and yourself, 24 00:01:06,280 --> 00:01:08,160 Speaker 3: I think we need to calm the farm a little bit. 25 00:01:08,640 --> 00:01:11,600 Speaker 3: And I'm spelling farm with the phs and pharmaceuticals, So 26 00:01:11,680 --> 00:01:15,680 Speaker 3: no pun intended. But look, what the Trump administration is doing, 27 00:01:15,720 --> 00:01:17,840 Speaker 3: and what the Secretary has said is that they are 28 00:01:17,920 --> 00:01:21,160 Speaker 3: undertaking what they call a Section two three two investigation, 29 00:01:22,440 --> 00:01:24,240 Speaker 3: and that's looking at things that might be of a 30 00:01:24,319 --> 00:01:29,640 Speaker 3: national security issue. They will undertake that. They've started the process. 31 00:01:29,720 --> 00:01:32,240 Speaker 3: It usually runs for over two hundred and seventy days 32 00:01:32,240 --> 00:01:35,600 Speaker 3: in total, but they're open for inputs right now for 33 00:01:35,640 --> 00:01:38,240 Speaker 3: the next twenty one days or so, and then they'll 34 00:01:38,280 --> 00:01:41,160 Speaker 3: make some decisions around this. So it's a little bit 35 00:01:41,160 --> 00:01:44,200 Speaker 3: early to tell what the teriffs may be. If there 36 00:01:44,240 --> 00:01:46,319 Speaker 3: will be teriffs, they may decide not to do this 37 00:01:46,400 --> 00:01:49,560 Speaker 3: at all. So while there is that drive to have 38 00:01:49,600 --> 00:01:54,680 Speaker 3: some on shoring. Now, around twenty percent of pharmaceutical manufacture 39 00:01:55,400 --> 00:01:57,520 Speaker 3: is done in the United States, the rest of it 40 00:01:57,880 --> 00:02:01,280 Speaker 3: they are importing from global supply chain around the world 41 00:02:01,280 --> 00:02:02,639 Speaker 3: at the moment, if they. 42 00:02:02,560 --> 00:02:04,680 Speaker 1: Were to go ahead with it, and it was significant 43 00:02:04,760 --> 00:02:06,640 Speaker 1: enough to kind of cause a bit of disruption, which 44 00:02:06,720 --> 00:02:10,080 Speaker 1: undoubtedly would happen for a little while. If they did it, 45 00:02:10,120 --> 00:02:12,760 Speaker 1: would the impact for US be actually that we ended 46 00:02:12,840 --> 00:02:16,920 Speaker 1: up having our market flooded potentially with cheaper drugs. 47 00:02:17,800 --> 00:02:20,200 Speaker 3: No, I don't think that's the case. I think because 48 00:02:20,200 --> 00:02:24,880 Speaker 3: the global supply chain and the industry itself is quite complicated, 49 00:02:25,919 --> 00:02:28,920 Speaker 3: there's many permutations that could happen. It may depend on 50 00:02:29,000 --> 00:02:33,440 Speaker 3: things like how companies countries may react to any tariff 51 00:02:33,440 --> 00:02:35,560 Speaker 3: that may be put on. But I will just draw 52 00:02:36,160 --> 00:02:38,080 Speaker 3: you know, your listeners attention to the fact that the 53 00:02:38,120 --> 00:02:41,480 Speaker 3: industry is working hard at the moment with the Trump 54 00:02:41,480 --> 00:02:47,160 Speaker 3: administration to discuss what the implications will be. So, for example, 55 00:02:47,520 --> 00:02:49,280 Speaker 3: it is not clear at the moment if there will 56 00:02:49,280 --> 00:02:52,800 Speaker 3: be terraff supplied after this section two three two investigation. 57 00:02:53,320 --> 00:02:55,920 Speaker 3: We will have to see whether that's the case or not. 58 00:02:56,480 --> 00:02:59,600 Speaker 3: There are conversations going on about having a teared teriff 59 00:02:59,600 --> 00:03:01,839 Speaker 3: for approach, which means that the impact is a lot 60 00:03:01,919 --> 00:03:06,360 Speaker 3: less both into the US market but also globally as well. 61 00:03:06,840 --> 00:03:10,160 Speaker 3: And there are conversations and the companies have indeed started 62 00:03:10,160 --> 00:03:12,880 Speaker 3: to do more on shoring. So I'm well aware that 63 00:03:12,919 --> 00:03:16,960 Speaker 3: there is more drive to onshuring manufacturer into the USA. 64 00:03:17,240 --> 00:03:20,000 Speaker 3: I'm aware of at least twelve new large scale facilities 65 00:03:20,000 --> 00:03:25,760 Speaker 3: at the innovative pharmaceutical sector is looking at onshuring as 66 00:03:25,800 --> 00:03:29,360 Speaker 3: we speak, and that's about an eighty billion billion dollars 67 00:03:29,400 --> 00:03:32,680 Speaker 3: for b B billion dollars investment that has been driven 68 00:03:32,720 --> 00:03:36,880 Speaker 3: back into the USA. So there's a lot of things 69 00:03:36,960 --> 00:03:38,200 Speaker 3: up in the air, a lot of dust up in 70 00:03:38,240 --> 00:03:40,480 Speaker 3: the air at the moment, and we're just not too sure. 71 00:03:40,520 --> 00:03:43,520 Speaker 3: So I think at this stage too difficult to say 72 00:03:43,720 --> 00:03:46,280 Speaker 3: what might come into the future. I think a few 73 00:03:46,280 --> 00:03:48,440 Speaker 3: things have got to play out over a period of 74 00:03:48,480 --> 00:03:50,760 Speaker 3: time and then we'll be in a better position to 75 00:03:50,800 --> 00:03:54,240 Speaker 3: have I think an informed conversation around what might be 76 00:03:54,320 --> 00:03:57,280 Speaker 3: happening from a New Zealand context, but also globally what 77 00:03:57,360 --> 00:03:58,760 Speaker 3: this might well mean as well. 78 00:03:59,320 --> 00:04:01,080 Speaker 1: Yeah, Graham and Oh, I think that's the best advice 79 00:04:01,120 --> 00:04:03,120 Speaker 1: read Trump is just you know, breathe through your nose 80 00:04:03,200 --> 00:04:05,400 Speaker 1: until the man actually does something. Grahama really appreciated this. 81 00:04:05,480 --> 00:04:07,560 Speaker 1: Graham Jarvis Medicines, New Zealand CEO. 82 00:04:08,200 --> 00:04:11,360 Speaker 3: For more from Hither Duplessy Allen Drive, listen live to 83 00:04:11,480 --> 00:04:14,520 Speaker 3: news talks it'd be from four pm weekdays, or follow 84 00:04:14,560 --> 00:04:16,320 Speaker 3: the podcast on iHeartRadio.