FTSE 100 pharma giants GSK and Astrazeneca may have dodged Trump tariffs

FTSE 100 pharmaceutical giants GSK and Astrazeneca may have avoided the brunt of US President Donald Trump's tariffs, a City broker suggests.

Pharmaceutical goods seem to be exempt from the higher-rate tariffs introduced by President Trump in his Rose Garden 'Liberation Day' address on Wednesday, but there remains uncertainty about the sector's impact, as reported by City AM.

This is according to a recent research note from Shore Capital, which has consulted with FTSE 100-listed pharmaceutical behemoths GlaxoSmithKline (GSK) and Astrazeneca regarding their interpretation of the tariffs.

The investment group confirmed that GSK anticipates no changes to its outlook based on the announcement, while Astrazeneca operates under the assumption that essential medicines will be exempt from the levies.

Astrazeneca emphasised that it will be "actively seeking to mitigate any impact" of the tariffs.

Dr Sean Conroy, healthcare equity research analyst for Shore Capital, stated: "Last night President Trump outlined broad reaching trade tariffs, but based on a clarifying Fact Sheet produced by The White House, it would appear that pharmaceutical goods imported into the US will be exempt from higher-rate Reciprocal Tariffs, at least for now."

He added: "It is still somewhat unclear whether the broader reaching 10% baseline tariffs could still be levied against imported drugs and vaccines, in our view."

Shore Capital has pointed out several unresolved issues for the pharmaceutical sector, including the specific impacts on drug and vaccine production and the potential inflationary effects of trade tariffs on consumers.

This analysis was released as the FTSE 100 experienced a sharp drop on Thursday morning after the declaration of a flat 10 per cent tariff on all UK exports.

Concerns persist around Trump's health secretary, Robert F Kennedy Jr, especially for vaccine producers, due to his past role at the helm of the anti-vaccine Children's Health Defence group and his dismissal of US vaccine official Peter Marks in March.

Dr Conroy mentioned that the "globalised nature of supply chains across the industry" presents "some perceived risk to near-term guidance" for major pharmaceutical companies.