Biotech stocks that survived April 2 feel the heat of Trump’s new pharma threat

If you thought a 104% tariff on China was bad enough, Trump’s found another way to make the markets about himself – now confirming major tariffs on pharmaceuticals.

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Pharmaceutical products were widely left out of Liberation Day tariff schedules – only a week ago – and perhaps that’s because the U.S. gets most of its antibiotics from China.

Or perhaps it was just a reprieve to make sure there were more tariffs left to wave around like a stick.

At any rate, Donnie says the U.S. will soon introduce a “major tariff,” which could be anywhere from something like 15% to ridiculous numbers above 50%.

It’s sure to be a sore point for Aussie investors exposed to biotech.

Just last week, Aussies biggest healthcare stock, blood plasma player CSL Ltd (ASX:CSL) was able to mostly survive a brutal sell-off when Liberation Day tariffs came into effect, given that pharma products weren’t included.

So too did HotCopper forum favourite Mesoblast (ASX:MSB), which declared it was ineligible for tariffs given that its stem cell donors are based in the U.S., making its products of U.S. origin (despite going via a lab in Singapore for processing.)

Well, now, investors aren’t so sure.

The Health Care sector was the worst-performing sector on the ASX at 1pm today.

Trump’s threat of pharmaceutical tariffs, communicated to the ASX by a bunch of headlines from leading news organisations, has quickly settled into Australian investors’ calculus.

A fear that pharmaceutical tariffs may or may not ensnare medical devices is likely also why hearing implant giant Cochlear Ltd (ASX:COH) has seen shares fall nearly -1.5% on Wednesday. Only yesterday, the company told investors it expected to dodge and weave around tariffs.

But that was then, and this is now.

As at 1pm AEST:

• CSL shares are down -5% to $233.81/sh
• MSB shares are down -7% to $1.63/sh
• COH shares are down -1.4% to $252.83/sh.

It’s looking like more pain ahead.

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