How Will the US Elections Affect the Pharmaceutical Industry in Latin America?

October was an eventful month in the Americas, and as we enter November much of the world’s attention has been focused on the US elections. With deep division between the two major candidates, companies prepared extensively for different outcomes. At the time of writing, it appears that a second Donald Trump presidency is imminent.

Now, we turn our attention to how this will affect our region. Early articles relating to Latin America mainly focus on Mexico. Major media outlets, including Reuters, predict an initial economic blow to the country. However, some analysts maintain a more optimistic view, noting that Mexico’s significant status as the USA’s third-largest trading partner provides leverage that could maintain stable relations despite initial challenges.

Further south, in Argentina, the media highlights similarities between Trump and Argentina’s President Javier Milei. Both leaders have expressed mutual admiration, indicating potential for strengthened bilateral relations. While the precise impacts on the region remain uncertain, Mr. Milei’s immediate plans to visit the USA for direct talks with Trump suggest that developments will unfold soon.

A central part of Trump’s campaign focused on immigration and bolstering US industry through increased tariffs.

While it’s still uncertain how this will impact countries south of the border, analyses from sources like the Economist Intelligence Unit predict that northern Latin American nations may feel more pressure, while the southern countries might face fewer disruptions.

Financial forecasts suggest the US dollar will strengthen under Trump’s proposed policies, driven by tax cuts and increased domestic spending. This could trigger a chain reaction throughout Latin America, potentially leading to reduced capital inflows, higher interest rates, and weaker local currencies.

The pharmaceutical industry may see significant changes under Trump’s focus on US manufacturing. In recent years, pharmaceuticals have been the second-largest import category in the USA, with over $200 billion in annual imports, and had been expected to continue to rise and take the top spot. A shift toward bolstering local production could mean new regulations, tax incentives, and financial support for domestic manufacturers. This could slow the growth of pharmaceutical imports and reshape the competitive landscape.

While changes in regulations pose potential challenges, they also create new opportunities.

Existing international partners may seek alternative markets, and Latin America must be ready to position itself as an attractive option. Additionally, if the quality of US production improves, it could lead to higher-quality products entering the Latin American market, enhancing the quality of life for the region’s people.

How these potential changes will affect Latin American markets will become clearer over time. At LAMA, we remain committed to tracking trends that impact our region and providing timely updates. With this issue at the forefront in the Americas, it will remain a priority for our ongoing analysis.

If you’re considering expanding your brand into the LATAM market, our consultancy is here to support you every step of the way, including in the exciting realm of nanomedicine and cosmetics. Together, we can unlock the full potential of your brand in this vibrant and growing market.