Tariffs won't force a major Swiss pharma company to move production

Summary

Marketplace Morning Report Summary

Title: Tariffs Won't Force a Major Swiss Pharma Company to Move Production
Host: Marketplace
Release Date: August 8, 2025

---

1. Introduction

In this episode of the Marketplace Morning Report, host Liana Byrne delivers a comprehensive overview of the latest developments in business and economics. From the pharmaceutical industry's stance on tariffs to significant movements in global markets and international affairs, the episode provides listeners with essential insights to kickstart their day.

---

2. Sandoz's Stance on Tariffs and US Manufacturing

Overview: A significant portion of the episode delves into the pharmaceutical sector's response to recent tariff news, focusing on Sandoz, a major player in the generic and biosimilar medicines market. Despite increasing tariffs, Sandoz remains hesitant to relocate its manufacturing operations back to the United States.

Key Points:

• Understanding Sandoz:

  • Liana Byrne [00:31]: Introduces Sandoz, highlighting its role in producing generics and biosimilars—copycat versions of brand-name drugs available post-patent expiration at a fraction of the cost.
  • Felicity Hannah [01:10]: Clarifies that unlike companies like Pfizer or AstraZeneca, Sandoz specializes in generics and biosimilars, providing more affordable medication options once original patents lapse.

• Impact of Tariffs:

  • Tariffs Context:

    • President Donald Trump has proposed substantial tariffs on imported goods, including up to 250% on farmer imports, impacting various sectors, including pharmaceuticals.

  • Sandoz’s Position:

    • Felicity Hannah [01:38]: Reports that Sandoz’s CEO, Richard Saynor, acknowledges the broad frustration over high drug prices, which are significantly higher in the US compared to Europe and the UK—sometimes "up to 10 or 12 times higher".
    • Richard Saynor [01:47]: States, "Patients are frequently paying very high prices for medicines that are much cheaper in Europe and in the UK," attributing the shift of manufacturing offshore to relentless cost-cutting—"the race to the bottom."

  • Resistance to Relocation:

    • Richard Saynor [02:24]: Emphasizes that tariffs alone "aren't enough to justify just the cost of building manufacturing sites in the US." The financial burden of establishing US-based manufacturing is enormous, potentially requiring "five hundreds of millions or billions of dollars" and spanning "three to five years" for completion.
    • Uncertainties Highlighted:
      • Saynor [02:37]: Expresses concerns over the uncertainties surrounding patent situations and payer frameworks, which make recouping investments risky.
      • He further states, "Our conversations with the administration, with Congress and other players [are] okay. How are you going to change the environment to make what is in theory an incredibly exciting market much more attractive?"

Insights: Sandoz recognizes the complexities involved in relocating manufacturing operations to the US. While tariffs aim to protect domestic industries and reduce dependence on foreign manufacturing, the financial and regulatory uncertainties present significant barriers. Sandoz's approach underscores the pharmaceutical industry's broader challenges in balancing cost pressures, regulatory landscapes, and global market dynamics.

---

3. Global Market Movements and Political Tensions

Japanese Stock Market Surge:

• Liana Byrne [03:19]: Reports that Japanese stocks saw a notable increase after Tokyo and Washington reached an agreement to ease car tariffs. The Nikkei 225 closed up nearly 2%, with automotive giants Toyota and Nissan leading the gains.

President Trump's Criticism of Intel's CEO:

• Overview:

  • President Trump has publicly targeted Intel’s CEO, Lip Bhutan, urging his resignation by alleging conflicts of interest tied to China.

• Details:

  • Katie Silver [03:46]: Elaborates on the allegations, stating that Mr. Tan has "investments at the USA are linked to the Chinese military." Despite Intel's significant investments in the "America first agenda," Trump claims that the CEO is "highly conflicted."
  • Intel’s Response:
    • Intel asserts that it remains committed to advancing US national and economic security interests, emphasizing that both the board of directors and Lip Bhutan are deeply dedicated to these goals.

Insights: These developments reflect the ongoing tensions between political leadership and major corporations, especially concerning national security and foreign investments. The stock market's positive response to tariff negotiations signifies the sensitive interplay between trade policies and investor confidence.

---

4. Democratic Republic of Congo’s Sponsorship Amidst Conflict

Overview: The episode shifts focus to international affairs, highlighting the Democratic Republic of Congo's (DRC) strategic move to boost its global profile through high-profile sports sponsorships amidst internal conflict and humanitarian crises.

Key Points:

• UN's Warning and Conflict Situation:

  • The UN warns that a potential peace deal with neighboring Rwanda may be unraveling due to attacks by Rwandan-backed rebel groups targeting civilians.

• DRC’s Sponsorship Strategy:

  • Will Chalk [04:48]: Reports on DRC’s sponsorship agreements with major football teams like Barcelona FC, AC Milan, and AS Monaco. The latest deal involves branding "Dr. Heart of Africa" on Barcelona's training tops, a four-year partnership costing approximately $50 million.

  • Objectives:

    • The DRC government aims to "raise the profile of the country" through these international sporting engagements.
    • The sponsorships include immersive exhibitions at Barcelona's stadium to showcase DRC’s cultural diversity and sporting traditions.

  • Local Perspectives:

    • Unnamed Local Resident [05:30]: Criticizes the focus on tourism, emphasizing the need for infrastructure development: "When those people come here for tourism, they should use that money to build the country so that when they call those people, they have something to see."

• Criticism and Concerns:

  • Maurice Carney [05:59]: From Friends of the Congo, voices skepticism about the priorities of the DRC government, pointing out pressing issues: "The country has 7 million internally displaced people and you have 70 million people living less than $2.15 a day." He questions the rationale behind investing heavily in marketing and promotion instead of addressing humanitarian needs.

  • Comparative Analysis with Rwanda:

    • Timothy Longman [06:45]: An international relations professor, notes that while Congo's move mirrors Rwanda’s sponsorship of Arsenal since 2018, the latter has faced accusations of backing rebel groups—allegations Rwanda denies. He adds, "Congo feels like, well, if they can do it, we should as well," but raises concerns about corruption and the effective allocation of sponsorship funds.

Insights: The DRC's sponsorship endeavors are seen as a double-edged sword. While they aim to enhance the nation's visibility and attract tourism, critics argue that such investments are misaligned with the country's urgent humanitarian and infrastructural needs. This scenario underscores the complex relationship between national image-building and addressing internal crises.

---

5. Conclusion

The Marketplace Morning Report adeptly navigates through a spectrum of topics, from the pharmaceutical industry's challenges with tariffs and manufacturing decisions to significant movements in global markets and the intricate dynamics of international politics and humanitarian efforts. By providing in-depth discussions and diverse perspectives, the episode equips listeners with a nuanced understanding of current economic and political landscapes.

---

Notable Quotes:

• Richard Saynor [01:47]: "Patients are frequently paying very high prices for medicines that are much cheaper in Europe and in the UK, sometimes up to 10 or 12 times higher."

• Richard Saynor [02:37]: "A tariff isn't going to encourage us directly to build and build manufacturing sites. It's not a cheap thing to do."

• Unnamed Local Resident [05:30]: "When those people come here for tourism, they should use that money to build the country so that when they call those people, they have something to see."

• Maurice Carney [05:59]: "The country has 7 million internally displaced people and you have 70 million people living less than $2.15 a day."

• Timothy Longman [06:45]: "Congo feels like, well, if they can do it, we should as well."

---

This detailed summary encapsulates the key discussions, insights, and conclusions from the episode, providing a coherent narrative for those who haven't listened to the Marketplace Morning Report.

Transcript

[Granger Representative]

This is the story of the one he's responsible for keeping a leading health care facility clean and safe. And he trusts Granger's high quality H vac cleaning and safety products combined with their world class supply chain to consistently deliver, ensuring he's covered inside and out so he can focus on keeping his facility clean to help protect the health of everyone inside. Call 1-800-granger clickranger.com or just stop by Granger for the ones who get it done.

[Liana Byrne]

One big pharma company says tariffs won't rush its production back to the US Just yet. Good morning. This is the Marketplace Morning Report and we're live from the BBC World Service. I'm Liana Byrne. So it's been another big week for tariffs news. And like lots of sectors, pharmaceuticals are still in the dark about what rates they could be hit with. But one of the biggest players, Sandoz, says tariffs won't tempt it to bring back manufacturing stateside. The BBC's Felicity Hannah has been speaking to Sandoz's CEO Richard Saynor. Hello, Phyllis.

[Felicity Hannah]

Hi, Liana.

[Liana Byrne]

So first of all, this isn't a household name, is it? What exactly does Sandoz do?

[Felicity Hannah]

So unlike big name companies like Pfizer or AstraZeneca that develop new drugs, what Sandoz does is focus on generics and what's called biosimilars. And these are essentially copycat versions of the brand name medicines that become available once the original patents expire and then they can be sold at a fraction of the cost.

[Liana Byrne]

Now, President Donald Trump has threatened big new duties on farmer imports up to 250%. So what's Sandoz's take on that?

[Felicity Hannah]

Well, interestingly, Richard Sener said he understands where the president is coming from, especially when it comes to that issue of the price of drugs. Here's what he had to say.

[Richard Saynor]

I think a lot of his frustration and rhetoric, and I broadly agree with, is that patients are frequently paying very high prices for medicines that are much cheaper in Europe and in the UK, sometimes up to 10 or 12 times higher. What's happened over years is pricing has got so low that frequently manufacturing gets moved offshore. So we no longer have very little manufacturing left in the US A lot of that manufacturing has moved to India and China because it's been the race to the bottom.

[Liana Byrne]

And is that pressure prompting companies like Sandoz to bring manufacturing back to the U.S. i mean, he was talking about that because the, that's the whole point of these tariffs, isn't it?

[Felicity Hannah]

Well, you would think so, but not yet. In fact, Richard Saynor was pretty blunt. He said tariffs alone aren't enough to justify just the cost of building manufacturing sites in the US until the environment.

[Richard Saynor]

Changes, a tariff isn't going to encourage us directly to build and build manufacturing sites. It's not a cheap thing to do. You know, it could be five hundreds of millions or billions of dollars. It's not a quick thing to do. It can be frequently three to five years. But then even if I did, I don't know when I can launch because of the uncertainty of the patent situation and I don't know I can necessarily get my money back because of the uncertainty about the payer framework and the distortions in the market. So our conversations with the administration, with Congress and other players is okay. How are you going to change the environment to make what is in theory an incredibly exciting market much more attractive?

[Liana Byrne]

Interesting stuff. Felicity Hanna, thank you so much for joining us in Marketplace.

[Felicity Hannah]

Thanks a lot.

[Liana Byrne]

Okay, let's do the numbers. Japanese stocks surged today after Tokyo and Washington reached a deal to ease car tariffs. The Nikkei 2 to 5 closed up almost 2% with Toyota and Nissan leading gains. Meanwhile, President Trump's taken aim at the boss of US Chipmaker intel, calling him to resign over what he says are troubling links to China. On social Media, he claimed CEO Lip Bhutan is highly conflicted. The BBC's Katie Silver has more.

[Katie Silver]

Mr. Tan allegedly has Investments at the USA are linked to the Chinese military. He was appointed as the head of Intel US Chip giant earlier this year. Just in March, it was one of the leaders when it came to chip production. But in recent decades, it's really fallen behind its Asian competitors As a result of all of this, it's received billions of dollars from the US Government. Intel says that it makes significant investments in the America first agenda, quote, unquote. And it said that both the board of directors intel and LIP Bhutan deeply committed to advancing US national and economic security interests.

[Liana Byrne]

Katie Silver reporting. All right, let's turn to a country that's been dogged by conflict for decades, the Democratic Republic of Congo. The UN's now warning that a peace deal with neighboring Rwanda could be falling apart after reports that Rwandan backed rebel groups have attacked and killed civilians. And amid the unrest, Congo's government is trying to raise its international profile, including a bold move to sponsor some of the world's biggest, biggest football teams. The BBC's Will Chalk has a story.

[Will Chalk]

A Barcelona FC training session with cameras snapping pictures of the players for sports websites and the next day's newspapers. In other words, A great advertising opportunity. And from next season, the team's training tops will have Dr. Heart of Africa written on them. It's part of a four year sponsorship deal and the Congolese government says it will raise the profile of the country. But the but it's not come cheap at around $50 million. And the DRC has already splashed out on similar deals with Italian side AC Milan and French team AS Monaco. Money well spent. We asked people in the country's capital, Kinshasa, It's a good idea to bring tourists in drc.

[Unnamed Local Resident]

When you talk about tourism, there should be things to see. When those people come here for tourism, they should use that money to build the country so that when they call those people, they have something to see.

[Will Chalk]

It's not just shirt sponsorship. It's claimed the deal will also involve Barcelona's stadium hosting an immersive exhibition to showcase the cultural diversity and sporting tradition of the drc. But for some, it shows the government has the wrong priorities. Maurice Carney runs US based advocacy group Friends of the Congo.

[Maurice Carney]

The country has 7 million internally displaced people and you have 70 million people living less than $2.15 a day. And the Congolese government is entering into a marketing and promotion agreement, a sponsorship agreement. It just doesn't add up.

[Will Chalk]

What makes things murkier is that in signing this deal, the DRC is following in the footsteps of its eastern neighbour, Rwanda, who sponsored Premier League side arsenal shirts. Since 2018, Rwanda has been accused of backing the rebel group involved in much of the violence in the east of the drc, something it denies. But the Congolese government has previously written to arsen Arsenal questioning the morality of the arrangement. Timothy Longman is an international relations professor at Boston University. He's been following the conflict for 30 years.

[Timothy Longman]

I think Congo feels like, well, if they can do it, we should as well. Congo, the problems are more closely related to corruption and so I do imagine there will be some concern about where this money is actually going to go. Yeah, Rwanda has a very different set of issues. It's a much stricter government that allows a lot less dissent. With Congo, the problem is more just where does the money go?

[Will Chalk]

From a Barcelona perspective, rightly or wrongly, it's 50% million and it's a sport where money talks. I'm the BBC's will chalk for Marketplace.

[Liana Byrne]

And I'm Liana Byrne with a Marketplace morning report from the BBC World Service.

[Granger Representative]

This is the story of the One. He's responsible for keeping a leading health care facility clean and safe. And he trusts Granger's high quality H Vac cleaning and safety products combined with their world class supply chain to consistently deliver. Ensuring he's covered inside and out so he can focus on keeping his facility clean to help protect the health of everyone inside. Call 1-800-granger clickranger.com or just stop by Granger for the ones who get it done.