President Donald Trump’s executive order pressuring pharmaceutical companies to drop US medicine prices poses a fresh set of transfer pricing issues, adding to a growing list from reciprocal tariffs and an ongoing investigation onto additional tariffs aimed at the industry.
Price cuts would reverberate through supply chains and force companies to reevaluate the profitability of each entity impacted by the change. If the chain involves related companies, that could mean adjusting the pricing of transfers between them—possibly redoing intercompany agreements as well as advance pricing agreements with tax authorities, tax practitioners said.
“It’s going to be a challenge to determine ...