Program: Trump's threat of 200pc tariffs on pharmaceuticals

Norman Swan: So, Olivia, what have you been exposed to today? 

Olivia Willis: Oh gosh, I mean, it's overwhelming thinking about all the possible environmental exposures that may have impacted my health, and that's just from literally walking out the front door of my house to getting to the office. 

Norman Swan: So have you mapped them?

Olivia Willis: Well, okay, there's air pollution as I'm walking down my street. I guess there's thinking about what I'm consuming in terms of drinking and eating. So the coffee, I'm drinking it out of…I hate to admit this, but I didn't have my keep-cup this morning, so out of a plastic cup. I had a takeaway for lunch today, so that came in plastic.

Norman Swan: It's everything. I mean, I wonder whether cycling into work I'm just cleaning up the air for everybody else, so my lungs are reducing everybody else's…

Olivia Willis: Oh, thanks.

Norman Swan: …exposome, which is what the word is for this universe of exposures, not just physical, but also social. So we're going to be talking about the human exposome project on this week's Health Report.

Olivia Willis: I'm Olivia Willis on Wurundjeri land.

Norman Swan: And I'm Norman Swan on Gadigal land.

Olivia Willis: Also on the show, Indigenous people are less likely to make it onto the wait list for a kidney transplant. We'll discuss the complex reasons behind the disparity and what's being done to address it.

Norman Swan: And GLP-1s, we talk about them a lot on the Health Report. Drugs like Ozempic and Wegovy, originally for diabetes, they've been called wonder drugs, but a new paper just recently released suggests there might be a risk, albeit a small one, to our eyesight.

Olivia Willis: Now on to this week's health news and, Norman, this week it was all about Donald Trump's proposed tariffs on pharmaceuticals, a whopping 200% tariffs.

Norman Swan: On imported pharmaceuticals to the United States, that's right. You know, there's a history here, for Australia anyway, but also other countries, is that the US pharmaceutical industry, which is a dominant industry globally, not the only one, has been complaining for years about government subsidised pharmaceutical benefit schemes. We are not the only one to have it, many countries with universal healthcare systems have them. They particularly dislike the Australian system because we've been world leaders in negotiating low prices, even for very expensive drugs. Australia has been really high on the target list because our pharmaceutical benefits scheme has really led the world in negotiating low prices, which other countries have followed. So the US pharmaceutical industry, while it makes a lot of money out of Australia and other countries, it's not quite as much as they'd like to make. 

So this is a 200% tariff. We don't know much of the details here. We export about $2.2 billion worth of pharmaceuticals a year to the United States, and we import from the US, interestingly, which is why it doesn't make a lot of sense, we import drugs worth about AU$4 billion. I mean, if only we were producing more of those drugs. I mean, those are drugs like immunotherapy, high value cancer drugs and others, which cost a fortune, even though we've negotiated low prices.

Olivia Willis: That's right. So Trump has said that…firstly, we should say that it's proposed changes, nothing has been confirmed yet, but as part of the potential 200% tariff he indicated there would be a grace period for manufacturers to move their operations to the US, which is, I guess, what is behind these kind of proposals.

Norman Swan: Which is a problem for Australia, because we have at least one very large pharmaceutical company which is indigenous to Australia. But for us to lose a significant part of our pharmaceutical industry is also a major issue here.

Olivia Willis: So Norman, when it comes to the drugs that we actually export, what are we talking about here? 

Norman Swan: I think CSL is the biggest target here. So that's a company that used to be fully government owned, fully public owned, and is now a private company which produces a lot of vaccines, and it produces a lot of blood products, antisera, immunoglobulin and other products, and they export those blood products. It's one of the biggest, if not the biggest. I don't know where it sits internationally, but it's certainly a huge global blood product company, as well as a vaccine manufacturer and distributor. So CSL probably is the one that's really being targeted here. Medicines Australia is the organisation which represents pharmaceutical companies in Australia. Interestingly, some of those pharmaceutical companies are actually US based. So there's some of the companies that are actually agitating against the PBS. But we spoke to the CEO of Medicines Australia, Elizabeth de Somer, about this issue, and particularly CSL.

Elizabeth de Somer: CSL do have a large presence in the US. At the moment my understanding is that a lot of the processing of blood products happens in Australia, and I'm sure CSL are looking closely at what things they may need to do in order to accommodate these announcements if they were to come to pass. It's worth also reflecting, though, that the announcements don't have much detail around them, and we can't be certain that these are tariffs that actually would be applied. 

Norman Swan: Elizabeth de Somer, Chief Executive of Medicines Australia. And Medicines Australia have iterated that they believe that the Pharmaceutical Benefit Scheme should continue, it's one of the longest-standing public health programs in the world, according to Elizabeth de Somer. But she argues that in fact if we streamlined what's called our health technology assessment scheme (in other words, to speed up the introduction of new drugs into the Australian market), then that might appease the lobbyists in the United States.

Olivia Willis: So I guess the potential impacts on manufacturers are there, but in terms of what it means for Australian consumers, experts have previously said on this that it's unlikely that US tariffs would really have any impact on prices here in Australia, unless we were to go down the path of reciprocal tariffs, in which we put a tariff on US pharmaceuticals coming in, in which case we would definitely see prices increase because we do import a reasonable amount of our pharmaceuticals from the US. But it sounds like just with their tariffs alone, it wouldn't necessarily have a big impact on, you know, me going down to the pharmacy tomorrow and getting something.

Norman Swan: No, but it does go to our desire to build a strong non-agriculture, non-primary-industry sector in Australia. And CSL is one of the relatively few companies in Australia that's actually doing that. We've got a lot of biotech companies doing interesting work. We often lose them to the United States in any event, but we want some self-sufficiency here, and it's a threat to that. 

Olivia Willis: So the final decision, we know, is not being made till the end of the month. I think the US government is conducting what they said is an investigation into pharmaceutical imports at the moment, and they're due to release that decision in late July.

Norman Swan: Now, we have covered medicinal cannabis and the prescribing thereof on the program in recent weeks, and we'll have a link to that on our show notes. But things have moved on since the last time we spoke about it. 

Olivia Willis: Yeah, they have. So this week the health practitioner watchdog, the Australian Health Practitioner Regulation Agency, or AHPRA, they have basically put medicinal cannabis prescribers on notice, saying that poor prescribing practices tests and I guess a surging demand amongst consumers is leading to what they describe as significant patient harm. So early this week, AHPRA released new guidelines essentially urging prescribers to put patient wellbeing above profits, and they said that their understanding was that there were some businesses that were using, quote, 'aggressive and sometimes misleading advertising that targets vulnerable people', which was contributing to this rapid rise in medicinal cannabis prescriptions. And as a part of this, it was revealed that AHPRA has put 57 medical practitioners, pharmacists and nurses on notice or taken action against 57 and is investigating a further 60.

Norman Swan: And as we indicated a couple of weeks ago on the show, some of the script writing has been at extraordinary volumes.

Olivia Willis: Yeah, that's right. So although AHPRA said that the majority of practitioners do the right thing, they've uncovered about half a dozen who issued more than 10,000 scripts in a six-month period, including one who issued 17,000, in other words, one every four minutes in a working day. And so it has pretty serious concerns for patient safety because of this excessive and inappropriate prescribing. And I guess AHPRA also…the new guidelines kind of explicitly double down on the fact that except in particular cases for specific health issues (so we're talking childhood epilepsy, pain associated with multiple sclerosis and cancer nausea linked to chemotherapy), there is basically little evidence to support the use of medicinal cannabis, and they kind of stress that it shouldn't be prescribed as a first line treatment and only used when other treatments haven't worked. 

Norman Swan: And as I said, we'll have a link to that previous story on our website.