Will Moving Drug Production to the United States Help or Hurt Patients?

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: What obstacles do you foresee regarding the availability of specialty medicines for US patients—as a result of supply chain challenges—and how can biopharma companies address these issues?

Levesque: If you're manufacturing, you're really upstream, and you are looking for your first, contract development and manufacturing organization (CDMO). In light of this situation, now, you're going to try to get a CDMO that operates in the US, but if you're currently manufacturing elsewhere, this transition cannot happen on a dime. We're talking about years, we're not talking about months. There won't be any short-term solutions, and unfortunately, tariffs will apply and will will probably have an impact on the value of medicines. There's no other way.

Is the solution 100% to actually use a CDMO in the US? It could be, but again, I'm intrigued by the effect that it's going to have on pricing, and I think it will be a negative for us patients.