Throughout 2025, the story of pharma manufacturing has been dominated by regulatory intervention.

The Trump administration has taken steps to strengthen domestic manufacturing across all industries since coming into office in January. However, the pharmaceutical industry has been uniquely targeted. This is due to the fact that the administration is going after both pharma importing and high drug prices at the same time.

As a result, global manufacturers found themselves in a situation where they must find ways to reduce treatment costs while also committing investments to US-based manufacturing sites. The administration even threatened to place 100% tariffs on pharmaceutical imports from companies that had not yet broken ground on domestic manufacturing plans and developments. While this threat was never actually enforced, it did bring major pharma organizations to the negotiating table.

A key step

Pharmaceutical Executive spoke with Marcel Botha, CEO of 10X Beta, about the push for domestic manufacturing of medicines. According to Botha, this is a necessary step.

“The supply chain risks have not been resolved at scale in the US,” he explains. “The geopolitical risk from the Russia-Ukraine War and the tariff trade war are all impacting our supply chain. We rely on various forms of sourcing from all over the world. Investing in US-based supply chains, from source components to final assembly, is a very valuable step for the US to take. It’s not a single, one-step solution. It’s not going to happen overnight, and it’s going to require a commitment from multiple administrations in order to work.”

Jay Bhatt, DO, managing director at the Deloitte Center for Health Solutions and Deloitte Health Institute for Deloitte Services LP, also spoke with Pharm Exec. According to his research, “Life sciences firms are increasingly considering new investments in US-based manufacturing as a response to tariffs and regulatory changes. Strategies include building new facilities, acquiring existing ones, or repurposing current assets to enhance manufacturing agility."

According to the Deloitte survey, “17% of respondents plan to move some manufacturing operations to the US, with 62% of those expecting their new facilities to be operational within five years. This trend suggests a gradual but meaningful shift toward domestic production, aimed at mitigating regulatory risks and improving supply chain resilience. Companies may have also advanced stockpiling strategies in anticipation of possible regulatory changes.”

Adapting in real time

When asked about the expected commercial impact that these trends will have, Bhatt says, “Approximately two-thirds of life sciences leaders anticipate that tariffs and pricing policies will have a moderate-to-major influence on their long-term commercial strategies. Rather than taking a wait-and-see approach, many commercial teams are proactively modeling business scenarios, particularly around pricing and market access.

“The survey found that 64% of executives are already incorporating these policies into their strategic planning," he continues, "with US-based companies about 20% more likely than their European counterparts to engage in active scenario modeling. This highlights a growing emphasis on agility and preparedness in commercial planning.”

As part of its push for domestic manufacturing, the US administration has created a variety of new programs at the FDA that reduce the approval timeline. Many of these programs, such as the abbreviated new drug application prioritization pilot, take domestic manufacturing into consideration before accepting applications.

Botha also discussed how this might impact manufacturing, saying, “Right now, we’re seeing multiple efforts made on the policy incentive front. There’s an accelerated facility approval plan, which would make it easier and transparent to onboard new manufacturing facilities. There are accelerated drug approval pathways for bringing new generic drugs online in the US. The combination of both US-based manufacturing and supply chains for [active pharmaceutical ingredients] puts companies in the front of the line for FDA review and accelerates time to market.”

Energized ecosystem

When asked about the broader impact, Botha continued, “I think it will have an immensely positive effect. During the pandemic, we saw extreme bottlenecks due to the consolidation of the drug industry. If we look at pharmaceutical production, there were a few mega players (predominantly in India and China) supplying drugs to the rest of the world. When the supply chain broke down, so did drug access. The new pilot will hopefully reinvigorate domestic, US-based drug production.”

It will take years for newly announced domestic manufacturing plants to come online. In the immediate future, industry experts are waiting to see if the investments in domestic manufacturing projects continue or if the administration will be satisfied with what’s already been announced. Regardless, the life sciences industry is still going to have to hope that it can avoid tariffs for at least a few more years.