Asian drug market stocks slides: Trump’s 100% pharmaceutical tariffs shake market; broader impact on Japan likely minimal

Asian drug stocks fell on Friday as investors reacted to US President Donald Trump’s threat to impose 100% tariffs on imported branded pharmaceuticals starting October 1.Companies without existing US manufacturing plants could face the full impact, triggering declines across major drugmakers in South Korea, Japan, and Hong Kong.In South Korea, Samsung Biologics fell 1.6%, while SK Biopharmaceuticals slid 2.6%. Celltrion, which recently acquired ImClone Systems from Eli Lilly in the United States for $330 million, rose 1.3% after recouping earlier losses.In Japan, Sumitomo Pharma tumbled 4.3%, Otsuka Holdings dropped 3.5%, and Daiichi Sankyo lost 1.6%. Takeda added 0.2%, and Shionogi gained 1.3%.Meanwhile, Hong Kong’s Hang Seng Biotech Index fell about 2.58%.Markets had already been braced for further tariffs and investigations by the US commerce department, said Carol Kong, economist and currency strategist at Commonwealth Bank of Australia in Sydney."The sectoral tariffs are here to stay because those have proven to be more legally sound than the emergency tariffs that the lower courts judged to be illegal," she said."Sectoral tariffs are going to push the US government's effective tariff rate a little bit high - it was about 10% in August, we expect the global effective tariff rate to edge further to about 18% in the coming months,” added Kong, as quoted by Reuters.Kong added that the broader impact on economies like Japan and Australia may be fairly limited.