Novartis CEO: Company Has Adequate Stockpile to Withstand Potential Trump Tariffs

Novartis (NOVN.S) has built up its U.S. drug inventories and is fully prepared in case its products are affected by potential tariffs under former President Donald Trump, the company’s Chief Executive Officer said in an interview published Saturday.

Currently, pharmaceuticals are exempt from the 39% tariff Washington imposed on Switzerland last month. However, the industry is awaiting the outcome of an investigation that could lead to sector-wide import duties.

In July, the U.S. also reached a bilateral trade agreement with the European Union, introducing a 15% tariff on medicines, with the exception of certain generic drugs.

CEO Vas Narasimhan told the Swiss daily Neue Zürcher Zeitung: “We have significantly increased our stock in the U.S., so it will certainly last until the middle of 2026.”

He added that Novartis has already announced a medium-term investment of $23 billion in the United States and aims to produce its most important products locally for the American market.

“This goal will probably take three to four years to achieve,” Narasimhan said. “But I expect we can make meaningful progress within the next two years—for example, shifting some final filling and packaging operations to the U.S.”

He noted that this would help the company “fully offset any tariffs.”

Narasimhan acknowledged it is “difficult to predict” whether potential duties of up to 250%, floated under Washington’s Section 232 probe into the pharmaceutical sector, are realistic.

“We are working through all possible scenarios,” he said. “Our hope is that the government recognizes that expanding production in the U.S. takes time. But until the so-called Section 232 investigation is completed, we will not have clarity. We don’t know when those results will be available.”