Fresenius Steps Up Amid Trump Tariff Threats - Keeping a Sturdy Foothold in the US Market
Fresenius raises its prices while aiming to dodge Trump's tariffs - Fresenius is boosting its production, managing to dodge Trump's tariffs
Hey there! Let's dive into the latest buzz around pharmaceutical giant, Fresenius. With increased profits on the horizon, they're holding talks with the US government to dodge potential pharmaceutical tariffs under President Donald Trump.
Michael Sen, CEO of Fresenius, feels optimistic about achieving annual targets, despite the looming tariffs. That's because they're seeing some fantastic results from subsidiaries like Helios and Kabi in the first quarter. The US market is a crucial player for Fresenius, generating around 10% of its revenue through its generic subsidiary Kabi. With 70% of medicines in the US produced domestically, Fresenius might not feel the tariff pinch as much as its foreign-based competitors from India and China.
In the first quarter, Fresenius reported a strong financial performance. Revenue increased by 7%, reaching €5.63 billion, and adjusted earnings before interest and taxes (EBIT) grew by 4% to €654 million. Kabi's core business growth in drugs, clinical nutrition, and medical technology, alongside a cost-cutting program, fueled this success.
Fresenius aims to boost revenue outside of one-time and currency effects by 4-6% by 2025, considering potential risks like unfavorable tariffs. As they navigate this complex landscape, let's mull over a few strategies European rivals might be pondering:
- State-side Shift: With the US offering a more competitive environment due to lower import costs, moving part of the operations to the States could be an attractive option for Fresenius.
- Lobbying and Diplomacy: Engaging in lobbying efforts both within the EU and with the US government to advocate for favorable trade conditions or exemptions could also be on the table.
- Supply Chain Diversification: Diversifying supply chains to lower reliance on US imports and exploring other markets not affected by tariffs is another strategy they might consider.
Now, it's essential to highlight that Fresenius hasn't explicitly stated that they're adopting these strategies. These possibilities stem from the tactics European rivals are considering as they grapple with the potential impact of US tariffs.
Stay tuned as we continue to track Fresenius's journey amidst the shifting sands of international trade!
- Fresenius SE
- Pharma
- Donald Trump
- USA
- Michael Sen
- Bad Homburg
- US President
- Despite the potential pharmaceutical tariffs suggested by President Donald Trump, Fresenius, a key player in the EC health policy sector, is actively engaging in talks with the US government to avoid such tariffs.
- CEO Michael Sen of Fresenius, based in Bad Homburg, remains optimistic about meeting annual targets, as subsidiaries like Helios and Kabi have shown promising results in the first quarter, contributing to the US market's significant presence in Fresenius's revenue.
- With the US accounting for approximately 10% of Fresenius's revenue through its generic subsidiary Kabi, the company might experience less impact from tariffs relative to foreign-based competitors like Indian and Chinese pharmaceutical companies.
- As part of its strategy to boost revenue, Fresenius aims to achieve a 4-6% increase in revenue outside of one-time and currency effects by 2025, amid potential risks such as unfavorable tariffs.
- In navigating this complex landscape, European rivals are pondering various strategies, including shifting part of the operations to the US for a more competitive environment, lobbying efforts within the EU and the US government, and supply chain diversification to lower reliance on US imports.
