NextFin news, Swiss pharmaceutical companies Roche and Novartis are moving a large share of their drug production to the United States following tariff threats from the US government. This shift is a direct response to potential tariffs of up to 250 percent on medications not produced in the US, as announced by former President Donald Trump.
Roche intends to invest approximately $50 billion to expand its production capacity in the US. The company aims to export more medicines from the US than it imports. Novartis plans to invest $23 billion to build new production plants and a research center in California, with the goal of manufacturing all key medications for the US market domestically.
The relocation process is complex and expected to take several years, as pharmaceutical manufacturing facilities cannot be moved quickly. Roche benefits from its existing strong presence in the US through its subsidiary Genentech, allowing it to scale up production more rapidly. Novartis is constructing multiple new facilities to support its production shift.
Despite the production moves, both companies emphasize that research and development activities will remain in Switzerland. Around 11,000 people are employed in R&D in Switzerland, and approximately 30,000 jobs are based at the companies' Swiss headquarters. The companies have stated that the production relocation will not significantly affect the Swiss pharmaceutical sector.
Swiss authorities are monitoring the situation closely. According to reports, a meeting involving pharmaceutical industry leaders and Swiss government representatives is planned to discuss the current challenges and potential measures following the summer holidays.
Explore more exclusive insights at nextfin.ai.
