From CNBC: 2025-04-16 12:46:00

President Donald Trump’s tariffs are causing a rift in the medical community. Device makers in China, Mexico, and Canada are not exempt from his latest round of levies, potentially increasing costs for hospitals and patients. Trade groups warn of reduced access to critical equipment and care due to the tariffs.

The tariffs imposed by Trump are adding pricing complexity, with rates reaching up to 145% for goods from China. Medical equipment sellers are struggling to offset increased costs under current insurance contracts, leading to concerns about pricing and access to crucial medical devices.

On the other hand, U.S. companies producing personal protective equipment (PPE) are welcoming the tariffs on China. Analysts estimate that roughly half of PPE used in the U.S. is produced in China, with additional levies imposed by the Biden administration last fall. Domestic PPE makers see the tariffs as an opportunity to gain market share.

Trump’s goal of encouraging U.S. manufacturing through tariffs may not be achieved in the case of PPE. Multinational producers are looking to shift manufacturing away from China to countries with lower tariffs, rather than bringing it back to the U.S. Some U.S.-based medical technology and device makers are considering shifting production to Mexico and Canada to secure exemptions.

Johnson & Johnson faces a $400 million tariff impact on its MedTech division this year, largely due to duties on Chinese imports and non-USMCA compliant imports. Existing contracts with hospitals make it difficult to raise prices in the near term. J&J CEO believes tariffs do not incentivize manufacturing in the U.S., suggesting tax policy as a more effective tool.



Read more at CNBC: Medical product manufacturers are divided over Trump’s tariffs