Finance

Novartis says US deal could shield it from tariffs

Novartis CEO Vas Narasimhan told CNBC at Davos that the company expects to be largely shielded from tariffs by mid-year thanks to U.S.-based production and on-hand inventory. The claim rests on an interview transcript and remains unverified publicly, with no confirmed government carve-out publicly documented.

📅 January 20, 2026
⏱️ 2 min read
Novartis says US deal could shield it from tariffs

Key Takeaways

  • Narasimhan says U.S.-based production and inventory could shield Novartis from tariffs by mid-year.
  • The report cites an alleged agreement with the U.S. government to exclude Novartis from tariffs, an assertion not publicly documented.
  • Novartis is investing $23 billion in manufacturing to build regional supply chains and defend against levies.
  • EU pharma exports to the U.S. totaled €84.4 billion in the first three quarters of last year, highlighting tariff exposure.
  • The tariff backdrop includes talk of 10% duties by Feb. 1 and 25% by June 1, creating policy uncertainty for makers of medicines.

People Involved

  • Vas NarasimhanCEO, Novartis
  • Karen TsoCNBC interviewer
  • Steve SedgwickCNBC interviewer

Entities Involved

  • Novartis AGGlobal pharmaceutical company

MarketMoodz Analysis

The statements, if verified, could imply a meaningful margin shield for Novartis as it onshores production and stockpiles inventory in the United States. For investors, the claim would support a case for steadier earnings in an environment of tariff volatility, and could cushion any near-term stock downside.

Historically, U.S.-EU trade frictions and talks of tariffs have weighed on cross-border pharma dynamics, making regionalized supply chains a recurring theme. Novartis’s $23 billion manufacturing investment aligns with a broader shift toward onshoring critical medicines, a move that could alter supplier leverage and R&D timelines.

What to watch next: seek a transcript or official Novartis comment to verify the government carve-out and Narasimhan’s exact wording; monitor whether other drugmakers purse similar regionalization strategies and how markets price in tariff risk.

Source: Original Article

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