German pharmaceutical industry expects revenue decline due to US tariff disputes

The German pharmaceutical industry is forecasting significant downturns in 2026, according to a report by the Association of Research-Based Pharmaceutical Manufacturers (VFA). Pharmaceutical production is expected to decrease by 2.2 percent, while real revenue is projected to fall by 1.8 percent.

These declines are largely attributed to trade tensions and tariff threats from US President Donald Trump. While a trade deal between Brussels and Washington currently caps tariffs on European medicines at 15 percent, previous threats of 100 percent tariffs on patented drugs created market instability. The industry, which exports approximately one-quarter of its products to the US, had previously seen a surge in 2025 as companies accelerated shipments to avoid potential duties. This has led to a corrective downward trend in 2026.

In addition to trade disputes, the VFA noted that low water levels are impacting production. The sector's workforce, totaling nearly 130,000 employees in Germany, is also seeing a stagnation in job growth. Furthermore, the industry has expressed criticism regarding German government policies, specifically increased manufacturer discounts intended to stabilize health insurance contributions.