Vas Narasimhan, CEO of Novartis AG (NYSE:NVS), said the Swiss drugmaker's expanding U.S. manufacturing footprint and a December agreement with the U.S. government could protect it from potential tariffs threatened by the Trump administration.
Speaking at the World Economic Forum in Davos, Narasimhan highlighted Novartis's $23 billion U.S. investment, unveiled last year, as a strategic safeguard that enables the company to supply the U.S. market primarily from domestic facilities. He added that existing stockpiles further cushion the company against near-term trade disruptions.
Trump has proposed tariffs starting Feb. 1 on imports from several European countries, beginning at 10% and rising to 25% in June. CNBC on Tuesday reported that European pharmaceuticals are considered particularly exposed, with U.S. shipments totaling €84.4 billion ($98.1 billion) in the first three quarters of 2025.
Under its agreement with Washington, Novartis supports the administration's drug pricing objectives and commits to introducing new medicines at comparable prices across high-income countries. Narasimhan said these steps, combined with expanded U.S. production, effectively "future-proof" the company against trade tensions, while preparing for alternative outcomes if exemptions do not materialize.
By securing additional supplies and planning new U.S. production capacity, Novartis is attempting to balance near-term protection against tariffs with long-term resilience in its American operations.
In November 2025, Novartis said it projects a stronger growth trajectory through 2030, lifting expectations for several key medicines and outlining a pipeline strategy it believes will sustain momentum well into the next decade.
The drugmaker anticipates a compound annual sales growth rate of 5% to 6% on a constant-currency basis from 2025 to 2030.
Price Action: NVS stock is up 0.41% at $145.60 at the last check on Friday.
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