With pharmaceutical tariffs emerging as a potential next target under the "reciprocal tariff" framework, EirGenix Chairman Lee-Cheng Liu stated that Herwenda (EG12014), a breast cancer biosimilar licensed to Sandoz and slated for U.S. market launch next year, will fall under Sandoz’s responsibility for any potential tariff costs in accordance with their agreement. As such, any tariff implementation would have a limited impact on EirGenix. Meanwhile, the company’s CDMO projects for U.S. clients have not yet reached commercial-scale production and are therefore unaffected by current tariff concerns. The Trump administration has yet to include pharmaceuticals under the reciprocal tariff proposal, and EirGenix continues to monitor the outcome of U.S.-EU negotiations.
Liu noted that while pharmaceuticals and semiconductors are not currently covered under the proposal, ongoing discussions suggest future developments are possible. However, if tariffs are imposed, the effect on Taiwan is expected to be minimal. The U.S.'s largest source of generic drug imports is India, which itself sources much of its pharmaceutical raw materials from China. In fact, the majority of raw ingredients for U.S. generics come from China.
Though China has responded with tariff policies of its own, cancer drugs—particularly those for critical care—have largely remained either untariffed or at zero tariff, since many of China’s cancer treatments still rely on imports. In the U.S., much of pharmaceutical manufacturing is also outsourced, primarily to countries like Ireland and Germany.
In terms of CDMO operations, current U.S. import duties are determined by the Harmonized Tariff Schedule (HTS) and country of origin. Pure CDMO services are not subject to tariffs, and only the imported physical products may incur such costs. With proper tariff planning and documentation, some expenses can be excluded from taxation. Most of EirGenix’s CDMO projects in the U.S. are still in early development stages and have not yet entered commercialization, leading to an initial assessment that Trump-era tariff proposals pose little threat to the company.
As for Herwenda (EG12014), based on Sandoz’s schedule, commercial sales in the U.S. are expected to begin next year. The current supply model involves EirGenix producing the drug substance, which is then shipped to a Sandoz facility within the EU for formulation into the drug product. Presently, the drug enters the U.S. duty-free, though trade negotiations between the U.S. and EU remain under close watch.
Importantly, under the terms of the agreement between EirGenix and Sandoz, Sandoz assumes responsibility for tax liabilities on product sales. Their profit-sharing arrangement is based on net sales after deducting manufacturing costs, with any related tariff costs borne by Sandoz. Consequently, the financial impact on EirGenix is expected to remain minimal.
Resource: CDMO美客戶未商業量產，乳癌藥關稅Sandoz負責，台康稱關稅影響有限
