The Supreme Court Rules On Trump Tariffs. Why Shout "Hooray!"?

By Louis Garguilo, Chief Editor, Outsourced Pharma

Like so many of you, I agree with the wise and narrow decision by the U.S. Supreme Court that President Trump cannot use the International Emergency Economic Powers Act to impose sweeping tariffs. That authority under the U.S. Constitution resides with Congress.

At the same time, for those of us who raised an instant “Hooray!” I’d humbly suggest we check in on why such enthusiasm.

All along but far from perfect, I've concentrated on providing readers an even treatment of Trump and his tariffs. You can judge the results for yourself.

It has been duly noted that tariffs cause serious consternation in our biopharma world. They can impact individual drug development and manufacturing outsourcing decisions.

However, I’d have been more buoyant – as it appears many were – with this decision by the Supreme Court if we had not already witnessed some distinct improvements in the U.S. on several biopharma fronts.

Those include sizeable biopharma infrastructure investments throughout the country in pharma and CDMO facilities, some drug pricing reductions and direct-to-consumer initiatives, and a lot more thought to a national supply-chain integration.

There certainly were negative consequences as well. Not least of which is how all involved in international supply chains lost hours trying to figure out implications to their products and services, and paid those tariffs.

This was a disruption unfair in its abruptness, and included the constant uncertainly of more threats.

But having said that, we’ve also reported over the past months that the Trump tariffs have not negatively affected our development and manufacturing milieu nearly as much as so many thought they would.

Therefore, it is important to consider whether ours was a vindictive “Hooray!” based mostly on the dislike of a president, or an actual dislike of reciprocal tariffs. If the former, what of those tariffs applied by most other countries against the U.S.?

Or perhaps, we might say, ours was a principled show of support for the independence of the Supreme Court in holding firm to the Constitution.

The suggestion is to approach this by considering what actually is positive for our industry. 

In other words, if not tariffs then:

• What is our plan for fighting tariffs and trade barriers every other country has habitually levied against U.S. commerce? 
• What is our plan for reshoring more of our supply chain, and encouraging pharmaceutical activity and investment on these shores (particularly to protect against interrupted drug supplies or drug shortages?)

Do we accept the status quo, for example, of higher drug prices in the U.S.; an overreliance on offshore facilities for our APIs and drugs; fewer CDMOs active in the U.S.; and remaining docile in the fight against China’s aggressive behavior, because we are antagonistic to the U.S. president?

Undeniably, the roll out, roll back, and run around by Trump on the tariffs has been regrettable.

But those happily goading an administration trying something new to overcome what has been an intractable set of challenges in our industry, should check motivations, and consider rationally what is actually best for us.

We hardly make antibiotics here. The U.S. lacks the sourcing and processing of scores of critical raw materials. So many of our intermediates and drug products must be imported. Our prices on drugs were again escalating – until some tariff-related and other Trump-led initiatives were put in place.

At this point, I'll risk saying this:

Tariffs, and trade agreements, done more professionally and with less theatrics, can work to enforce some needed adjustments in our outsourcing industry.

Cheer Nor Jeer

In earlier editorials I've dubbed all this mayhemTrump’s tariff tantrums.

What I am prosecuting here is for keeping a level head. Let’s not forget our pre-tariff starting point was, to say the least, suboptimal for drug-supply security and our U.S.-based industry.

New ideas were needed. Reciprocal U.S. tariffs were one of them. And for those with immediate jumps for joy over this Supreme Court ruling, surely that balloon was popped with the realization literally hours later that tariffs are not going anywhere.

So, as difficult as this is, let's continue to fairly assess their effects – positive and negative.

Above we noted the Supreme Court confirmed the mechanism by which Trump applied this round of tariffs can only be utilized by Congress.

Think carefully about that.

Congress is the august body that gave us the BIOSECURE Act.

Regarding that piece of proposed legislation, I took a strong stand in support of China-based WuXi Biologics and WuXi AppTec, which had been singled out in a wayward attempt to thwart China espionage.

It was rewarding so many readers agreed with that stance. Did we make an impact? All I can say is when that Act was passed at the end of 2025, WuXi was NOT named.

I believe ours to have been a level, nuanced position. Most of us agreed we need to combat the China Communist Party’s interference in our industry, but we also stood firm in defense of a China-based member of our outsourcing community. (“We,” unfortunately, not including the Biotechnology Information Organization (BIO).)

So what is my plan?

It is indeed modest, but as the reaction by many to this Supreme Court verdict demonstrates, also difficult.

I plan to not get blinded by political leanings or personalities. To consider what is best policy for global development and manufacturing outsourcing, while keeping in mind a large component of that will always be solving challenges we face in the U.S., no matter who is implementing them.