U.S. opens tariff probe targeting Germany’s drug pricing policies

The United States has launched an investigation into Germany’s drug policies, which it calls “persistent underpayment” for medicines, as the European country tries to contain spiraling healthcare spending, including on pharmaceuticals.

“President Trump has made clear that American patients should not receive a disproportionate share of global drug research and development,” said U.S. Trade Representative Jamieson Greer. in a late statement Thursday.

“I am particularly concerned by reports that Germany is accelerating legislation that would further reduce spending on innovative pharmaceuticals,” he said, calling it a “serious step back.”

In April, Germany proposed an overhaul of its health insurance system to relieve pressure on public finances as healthcare spending has risen significantly in recent years.

It has introduced a series of cost-saving measures, including higher deductibles for insurance funds in the pharmaceutical industry, prompting several drugmaker executives to warn they could withdraw or delay new drugs in the country.

The draft legislation is currently going through the parliamentary process.

The U.S. investigation was initiated under Section 301 of the Trade Act, which allows unilateral action against countries with unfair practices that negatively impact U.S. commerce.

Greer said U.S. trading partners must pay their share to fund research into new drugs, and the investigations came after months of talks with German partners.

Last year, the Trump administration implemented the Most Favored Nation drug policy (MFN), which ties drug prices in the United States to prices abroad.

The German Health Ministry did not immediately respond to a request for comment.