The United States is rattling its trade sabres again, this time targeting imported pharmaceuticals. But despite growing pressure, Sweden’s life science companies aren’t packing their bags for America just yet.
US Trade Representative Howard Lutnick recently floated the idea of steep tariffs on medicines not manufactured domestically. That’s a red flag for Swedish pharmaceutical firms, especially since the US remains their largest export market. While a partial EU-US trade agreement capped medicine tariffs at 15 percent, Washington’s rhetoric signals that more aggressive measures could still be coming.
That uncertainty is creating headaches in Stockholm. Jessica Martinsson, CEO of Sweden Bio—the industry association representing over 300 Swedish life science companies—says many of her members are alarmed.
“Large, long-term investments are the foundation of this industry,” she says. “Companies are already struggling to survive. The risk now is that tariffs could push some over the edge.”
Still, don’t expect a wave of corporate relocations across the Atlantic. Martinsson is blunt: “Setting up a new pharmaceutical factory takes longer than a US presidential term. That kind of move just isn’t realistic.”
Why Companies Are Staying Put
For most Swedish firms, the cost and complexity of moving operations are deal-breakers. Manufacturing pharmaceuticals isn’t plug-and-play. Components in the supply chain—everything from active ingredients to equipment—often require fresh regulatory approval if they’re moved or substituted. That process can be slow, expensive, and risky.
On top of that, shifting production to the US would likely mean layoffs in Sweden, adding political and social pressure to the mix.
Instead of relocating, many firms are looking elsewhere. “We’re shifting focus to other markets like the EU and Asia,” says Martinsson.
Trump’s Pressure Campaign Adds Fuel
Adding another layer of uncertainty, former President Donald Trump—now back in the headlines—has sent letters to 17 major drugmakers, including AstraZeneca, urging them to cut prescription drug prices in the US. He’s threatened penalties if they don’t comply within 60 days. The message was delivered via his platform, Truth Social.
It’s unclear how this political manoeuvre will intersect with the tariff threat, but for foreign manufacturers, it’s another reminder that the US market can be volatile—especially in election season.
Big Players, Bigger Stakes
Some of Sweden’s most important pharmaceutical players are deeply tied to US trade. Pfizer, though American, runs a major biotech facility in Strängnäs, Sweden. Cytiva, based in Uppsala, produces critical purification equipment used globally, including for insulin manufacturing. And AstraZeneca, whose Swedish operations account for nearly 70 percent of the country’s pharmaceutical exports, is a pillar of the sector.
AstraZeneca recently announced a $50 billion investment package in the US, including a new factory in Virginia. That shows how global giants are hedging their bets—but it’s also a sign that while companies might expand in the US, they aren’t necessarily abandoning Sweden.
Sweden’s Policy Response
To help steady the industry, the Swedish government is exploring tax incentives for pharmaceutical R&D. A formal proposal is expected in January 2026. Whether that’s fast or bold enough to matter remains to be seen.
Bottom line: Sweden’s pharmaceutical industry is watching US trade policy closely, but it’s not hitting the panic button. Companies are cautious, not reactionary. Their strategy—for now—is to ride out the storm, diversify their export base, and stay grounded.