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Advamed, one of the largest trading groups in the medical device industry Repeated the opposite After the Trump administration announced new obligations for most U.S. trading partners, action would damage innovation, cost employment and increase medical costs, leading to widespread tariffs on Wednesday.
“The MedTech industry should be exempt from these tariffs,” CEO Scott Whitaker said in a statement.
President Donald Trump speaks at the Rose Garden in the White House. The US imposes a 10% baseline tariff Addresses trade imbalances for higher “mutual” rates with most US imports in certain countries; Some products have been exemptedIncludes pharmaceuticals.
The White House also said that non-tariff barriers will deprive U.S. manufacturers of mutual access to the market, I called India To impose “uniquely burdensome and/or overlapping testing and certification requirements” on sectors that include medical devices that make it difficult for US companies to sell products domestically.
Whitaker said Advamed will continue his “conversation with the White House” to help him understand MedTech's role in the healthcare ecosystem, its value for patients, and its impact on US economic growth.
“Historically, industries with meaningful humanitarian missions have been exempt from a wide range of tariffs,” he said.
Meanwhile, providers have endured the effects of tariffs after the Healthcare Association, along with the Healthcare Distribution Alliance, were unable to protect the American Hospital Association. Important Medical Supplies Engravingdespite months of lobbying.
JP Morgan analyst Robbie Marcus said in a report Wednesday that tariffs that affect MedTech companies most include the 20% import tax in the European Union, 24% in Malaysia and 10% in Costa Rica, while China's 34% tax rate has had some impact.
The previously announced 25% tariffs in Canada and Mexico are also expected to begin. However, these charges are likely not applicable to most Medtech products, which fall under the US-Mexico-Canada agreement, Marcus said.
According to Marcus, USMCA compliance is positive for device manufacturers such as intuitive surgery, Hemonetics, Comed, Enobis and Merit Medical Systems.
Needham analyst Mike Mattson said it would be difficult to quantify device manufacturers' exposure to tariffs from public disclosures, but with a significant amount of manufacturing in the US, it could have a lower impact than companies in other sectors.
“Nevertheless, we believe that almost every Medtech company relies on some degree of raw materials and components (such as semiconductor chips) sourced from outside the US,” Matson told clients in a note Thursday.
MDMA, an industry group for device manufacturers, declined to comment on the new tariffs.
Tariffs can increase the cost of providing care in hospitals and health systems At least 15%according to a survey of 200 healthcare professionals conducted by Black Book Research in February.
90% of hospital finance executives surveyed said they would shift the increased costs to insurers and patients, leading to higher service charges.
Ned Hux, PWC US's tax leader in drug and life sciences, told Dive via email that medical care will put tariffs on pressure on healthcare providers “almost certainly” due to increased costs for medicines, diagnostics and medical devices.
“For providers, this is not just a pricing issue, it's an operational issue,” Hux said in an email. “Improved cost volatility can constrain formulary, complicate long-term sourcing strategies, and reduce flexibility in managing patient care.”
Analysts say that if drug tariffs are targeting European trade partners for European trade partners, the impact could be even more severe.
“People have been able to find themselves at the forefront of a global policy shift,” Hux added.
This harsh prediction is Fitch rating outlook starting Februarysaid tariffs will have the biggest impact on healthcare providers if the Trump administration chooses to change trade ties with European allies.
Ricky Zipp contributed the report.
