Why Distractions Are Detrimental to Business

In a video interview with Pharma Commerce, Paul Levesque, CEO of Theratechnologies, explains how Theratechnologies' operations have been impacted by recent US tariffs on Canadian goods, especially concerning the manufacturing and supply chain for its HIV therapy, EGRIFTA SV. The active ingredients used in EGRIFTA SV come from the US, travel to Canada for additional processing, and then return to the US for final assembly. As a result, the company faces tariffs on both the raw materials and parts of the manufacturing process that cross the US-Canada border. While the tariffs will increase costs, the company benefits slightly since the tariffs are applied to raw materials and intermediate steps, rather than the fully finished product, which would have resulted in a higher cost increase.

Theratechnologies is currently assessing the full impact of these tariffs on its supply chain, including effects on insurers, governments, and patients. Despite these challenges, the company remains committed to ensuring timely delivery of its therapies to patients, managing the increased costs as best as possible.

Levesgque also comments on the forecasted obstacles regarding the availability of specialty medicines for US patients; making the decision to reshore manufacturing processes; and much more.

A transcript of his conversation with PC can be found below.

Note: The FDA approved the company’s supplemental Biologics License Application (sBLA) for the F8 formulation of tesamorelin for injection on March 25. The new formulation will be commercialized under the tradename EGRIFTA WR and is expected to EGRIFTA SV.

PC: Why are distractions detrimental to business?

Levesque: This creates distraction. Distraction is never good in business, especially if you drive innovation and you're focusing on bringing solutions to patients. I think the situation is uneasy, because, first of all, we're not totally sure that we have the facts to actually juggle with this issue the best possible way and find a solution.

My last thought is, there's always a payer for medicine. Sometimes it's the patient, sometimes it's the government. If governments are basically taxing medicines, that means that governments that are reimbursing medicines will pay a higher price. That is bound to be an issue. The US government has an Inflation Reduction Act in place so that we cannot increase the prices of medicines for the medicines they are imbursed. They want to control cost.

Well, governments in Canada and elsewhere have the same type of approach, so that is really opening up a potential can of worms that could create a lot of grief. How it will settle, I don't know, but I think that the people that are putting in place these changes now have not assessed that properly, and it will have repercussions. As I said before, I think the pharma industry will be nimble again, will stay focused, and will try to identify solutions. There are potential solutions, but as I said, most of them cannot be implemented on a dime. It's a significant disruption in the way we operate, especially for two countries that are so intertwined in all they do, as Canada and the US are.