How Pharmaceutical Companies Can Mitigate a Potential Drop in Demand Due to Tariffs

In this Pharmaceutical Executive Video Interview, Peter Ax, Founder & CEO of UpScriptHealth, discusses the impact of tariffs on the pharmaceutical industry, highlighting that tariffs will initially affect pharmaceutical companies, particularly those dealing with branded medications and generics. He notes that tariffs could lead to strategic supply chain changes, including potential US manufacturing shifts. Digital health platforms like UpScriptHealth aim to reduce friction and costs in healthcare, potentially offsetting tariff impacts. Ax emphasizes the importance of telehealth in ensuring medication availability and the strategic partnerships between digital health platforms and pharma companies to improve patient care and access. He also praises Pfizer's approach to delivering comprehensive care rather than just selling medications.

Tariffs could impact consumer demand. What strategies can pharmaceutical companies and digital health platforms like UpScriptHealth employ to mitigate this potential drop in demand due to increased costs?

Tariffs will increase costs — short run and long run — and will have different effects on the supply curve. But the bigger issue is, how do we solve the systemic problems that are involved in healthcare? And that's where digital platforms like UpScriptHealth (UpScript) come into play. The number one thing we have to do is take the friction and cost out of the system, and that's what we do every single day. We make trained clinicians available to patients right away. We make the insurance reimbursement process a lot simpler in terms of: we'll process the prior authorization for patients. We’ll process a lot of things behind the scenes to help the patient get on therapy as fast as they can.

So, we sort of take friction out of the system, and that's really going to be the job of digital health companies like UpScript, and that's going to continue to be the job. Take costs out of the system, take friction out of the system, make medications accessible, and if we can take some costs out of the system, we might actually offset any effect the tariffs have.