PoliticsAnalysis

‘Ireland has our pharma companies,’ says Trump. But what will he do about it?

US president said that if he had been in the Oval Office when pharma companies first set up in Ireland, he would have imposed 200% tariffs on their return to the United States

Speaker of the House of Representatives Mike Johnson (Republican), US president Donald Trump and Taoiseach Micheál Martin on Capitol Hill, Washington, on Wednesday. Photograph: Doug Mills/New York Times
Speaker of the House of Representatives Mike Johnson (Republican), US president Donald Trump and Taoiseach Micheál Martin on Capitol Hill, Washington, on Wednesday. Photograph: Doug Mills/New York Times
Cliff Taylor's picture
Cliff Taylor
Wed Mar 12 2025 - 20:07

“Ireland has our pharma companies,” said US president Donald Trump on Wednesday in some of the most significant comments of his encounter with Taoiseach Micheál Martin.

And he wants them back. Trump wants US drugs to be made at home, not shipped in from countries like Ireland and this is a significant economic issue for this State.

It seems tariffs are the chosen tactic of Trump to try to achieve this. He said in the Oval Office, that had he been president when the pharma companies first set up in Ireland, he would have imposed 200 per cent tariffs on their import into the US market. These companies also sell to other world markets from the State, but it is the drugs and products they return to the United States that irritate Trump.

US president Donald Trump has discussed trade with Ireland and tariffs on EU goods during a meeting with Taoiseach Micheál Martin. Video: Reuters/C-Span

Tariffs remain his weapon of choice, to try to achieve this. Imposing them on imports of pharma into the US would upset the business models of the big companies. His rhetoric is already having an impact, with some big firms with operations here – such as Eli Lilly – promising to invest more in the US. Whether this is at the expense of investment here is not entirely clear, though if tariffs are introduced pharma companies are likely to use any spare capacity in the US in the short term and cut production in overseas locations like Ireland. Pfizer, another big investor here, has already indicated it may use this approach.

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There may be more of this to come and also changes in the structure of these companies which could lead to them paying less tax here.

[ Micheál Martin’s White House bout with Donald Trump: How did the Taoiseach fare? ]

As well as the pharma issue, the meeting underlined that there are more general threats as trade tensions brew between the United States and European Union. However, Trump also said: “We don’t want to do anything to hurt Ireland, but we do want fairness.”

But kind words from Washington will not protect Ireland if a full-scale trade war breaks out, driven by Trump’s view, outlined again on Wednesday, that the EU treats the US unfairly. The president again indicated that much wider tariffs on the European Union and other countries are due next month. If this happens, other Irish exports to the US, such as food and drink, would certainly be caught in the first round of any general tariffs.

Beyond that, a tit-for-tat trade war between the EU and US – were it to escalate – would have serious consequences for the Irish economy, particularly if it was prolonged. As well as hitting exports to the US, it would push up the cost of imports and hit trade and investment. For this reason, Ireland will try, as far as it can, to reduce tensions and limit the EU reaction particularly the use of punitive measures aimed at digital services companies which are one of the options for Brussels.