As Korea’s biopharmaceutical and medical device industries remain focused on expanding their foothold in the U.S. market, President-elect Donald J. Trump’s return to the White House next Monday has executives bracing for a mix of policy shifts—some that could unlock new opportunities and others that might present significant challenges.

Regulatory shifts: the ‘Made in USA’ push

The biggest immediate concern for Korean healthcare companies is the uncertainty surrounding trade. Trump has floated the idea of a universal tariff of 10 to 20 percent on all imports, a move that could erase Korea’s cost advantage in pharmaceuticals, biosimilars, and medical devices. 

While the United States-Korea Free Trade Agreement (KORUS FTA) currently allows Korean pharmaceutical and medical exports to enter tariff-free, industry insiders worry that a second Trump administration could introduce new sector-specific tariffs or regulatory hurdles.

“The most critical area requiring attention in terms of policy is tariffs,” said a senior official from the Korea Biotechnology Industry Organization (KoreaBIO). Pharmaceuticals and most medical devices, which are currently exempt, could face restrictions under a protectionist trade agenda, alongside biologics and contract manufacturing organizations (CMOs) that rely on global supply chains.

Korea’s biosimilars industry, where firms like Celltrion and Samsung Biologics are global leaders, could also face challenges. Discussions about potentially removing the legal framework for interchangeability status in 2025 have raised concerns over increased regulatory burdens.

“If interchangeability is revoked, companies will face higher regulatory burdens,” said the KoreaBIO official. “However, eliminating the framework entirely might benefit Korean biosimilar manufacturers by leveling the playing field in the U.S. market.”

Price pressures are another concern. Trump’s previous policies, such as the Most-Favored Nation (MFN) rule tying drug prices to the lowest among FTA partners, could resurface. An official at the Korea Pharmaceutical and Bio-Pharma Manufacturers Association said while this could amplify demand for cost-competitive biosimilars, it may also squeeze margins for Korean firms.

Celltrion, a major biosimilar manufacturer, indicated it would wait for clearer policy developments before announcing its strategy, while Samsung Biologics acknowledged the sensitivity of the issue but declined to provide further comments.

Protectionist policies also pose risks. A renewed push for "Made in USA” manufacturing could bring stricter domestic production requirements, raising barriers for foreign firms. While Trump’s first term largely spared Korea’s healthcare exports, a second term could see greater pressure on companies to establish local production facilities.

“In this sense, protectionism serves as a tool for fostering domestic industries,” the KoreaBIO official said. “Korean firms will have to assess how U.S. incentives might impact their strategies.”

Healthcare reform: less government, more market forces 

Beyond trade, Trump is expected to push healthcare policy toward a more privatized model, prioritizing private insurance while reducing government oversight. For some, this shift could be a boon.

Jong Woo-seok, chief financial officer (CFO) of AI-driven medical imaging firm Coreline Soft, sees an opportunity. “Privatized systems could drive demand for high-value medical devices, including AI-powered imaging solutions, which were often deprioritized under Democratic policies,” he said.

However, privatization could disrupt existing business models. Stricter domestic manufacturing rules may increase costs for Korean companies, while pharmacy benefit managers (PBMs) will play a key role in determining market access for foreign pharmaceutical firms.

“PBMs focus on maintaining profitability through rebates, so drug pricing is not their primary concern,” the KoreaBIO official explained. “This could still favor imported products as long as margins remain sufficient.”

AI-powered healthcare firms prepare for change

For Korea’s growing medical AI sector, which includes companies like Lunit, Coreline Soft, and Deep Bio, Trump’s policies could be a double-edged sword. 

If Trump's fundamental notion of "putting America First" leads to trade barriers, Coreline Soft's CFO Jong said Korean companies may need to adopt strategies similar to what electric vehicle and auto parts manufacturers have done—establishing local production facilities.

Many firms expanding into the U.S. market have already taken steps to align with these shifting trade dynamics.

Lunit, known for its AI-powered cancer detection tools, has hedged against potential risks by expanding its U.S. footprint through its subsidiary, Volpara Health Technologies.

A Lunit official stated that the company is increasing R&D investments and broadening its distribution network in anticipation of intensified competition.

Deep Bio, specializing in AI-based pathology solutions, secured a U.S. digital pathology reimbursement code last year. A Deep Bio official noted that this positioning allows the company to benefit from higher reimbursement rates under private insurance.

Still, companies remain wary of reduced government support for research. A potential rollback of Biden’s Cancer Moonshot initiative, which aims to accelerate scientific discovery in cancer research, could stifle collaboration and innovation. “Private insurance expansion may help with reimbursements, but losing federal funding is a serious concern,” a Deep Bio official said.

FDA deregulation: opportunity or risk?

Jong said relaxed regulations could also flood the market with lower-quality products, potentially harming overall standards. “Some European hospitals have turned to our product because of rigorous FDA approvals,” he said. “That shows how regulatory rigor can sometimes work to a company’s advantage.”

For companies like Deep Bio, which operates under the Clinical Laboratory Improvement Amendments (CLIA) framework, the risks are lower compared to hardware-focused firms. “Even liquid biopsy technology, traditionally a hardware-driven approach, is increasingly incorporating AI-powered diagnostics,” the Deep Bio official noted.“Hardware medical device firms may need to rethink their strategies.”

Ultimately, the biggest challenge may not be tariffs or regulations—but unpredictability itself. “Trump has a history of making announcements first and implementing policies later,” said the KoreaBIO official. “This uncertainty poses the biggest risk to companies planning their U.S. market strategies.”