Canberra, April 3 – The Australian federal government will not change its subsidy scheme for medicines in response to pressure from the US administration, said Health Minister Mark Butler on Friday.
Butler told the Seven Network television that Australia will not negotiate with the United States on the "fundamentals" of the Pharmaceutical Benefits Scheme (PBS), under which the federal government subsidizes the cost of prescription medicines, according to Xinhua news agency.
"We are consistently sending the clearest possible message to the US because we know they are trying to influence large drug companies to undermine the PBS here in Australia and similar schemes in other countries around the world. We are not negotiating about those fundamentals," he said.
Butler was speaking after US President Donald Trump signed an executive order on Thursday imposing a 100 per cent tariff on imports of certain patented pharmaceuticals.
In an updated list of trade grievances with Australia released late in March, the US administration said that the PBS undervalues American innovation through unfair drug pricing practices.
Under the scheme, pharmaceutical manufacturers must negotiate sales directly with the Australian government rather than individual buyers to prevent commercial bidding wars.
According to data from the United Nations' Comtrade, Australian pharmaceutical exports to the United States were worth $1.3 billion in 2025.
Biotechnology giant CSL is Australia's largest pharmaceutical company, but Butler said on Friday that the government is confident the Melbourne-based firm will be exempt from the new tariffs because of its large US manufacturing presence.
A spokesperson for trade minister Don Farrell told the Australian Broadcasting Corporation on Friday that the government was disappointed by the US tariffs on pharmaceuticals and would continue to push for the removal of "unjustified and unwarranted" tariffs.
