Faster AI drug development set to reshape pharma supply chains

Artificial intelligence (AI) is rapidly transforming drug discovery and development. A process that once averaged 10 to 15 years is now compressed to as little as 12 to 18 months as AI speeds up target identification, compound screening, and trial design.

In 2025, an estimated 30% of new drugs were discovered using AI, allowing manufacturers to explore more compounds and bring potential breakthroughs forward faster. By 2034, the market for AI-enabled drug development is projected to grow from $2 billion in 2025 to $17 billion.

AI is also improving the efficiency and success rates of drug trials by identifying promising candidates earlier, enabling smarter patient selection, and analyzing large datasets faster.

Faster development cycles tighten planning windows and increase demand for agile, temperature-controlled logistics. As drug pipelines expand, companies need more flexible cold-chain capacity and real-time visibility to maintain temperature integrity and chain of custody.

New U.S. healthcare proposal

On January 15, the White House released a proposal on drug prices, health insurance premiums, and price transparency. The proposal includes “most favored nation” agreements with certain drug manufacturers, offering Americans the lowest cost paid in other developed countries for the same medications. It also calls on insurance providers to publish rate and coverage comparisons in an easy-to-understand way on their websites and calls on healthcare providers and insurers that accept Medicare or Medicaid to prominently post their pricing and fees.

While monitoring developments on the proposal, smarter supply chains can offset potential costs. Careful scenario planning will allow shippers to identify their most cost-effective logistics options while meeting all of their safety and on-time requirements.

CMS proposes Secure American Medical Supplies designation

The Centers for Medicare & Medicaid Services (CMS) is exploring a new “Secure American Medical Supplies” designation for hospitals that purchase a minimum percentage of American-made personal protective equipment and essential medicines. Hospitals meeting these thresholds could qualify for a separate Medicare payment to offset higher domestic sourcing costs.

CMS is also considering adding a structural quality measure tied to U.S.-made personal protective equipment and medicines, reflecting lessons from COVID-19 and the administration’s push to strengthen domestic manufacturing. CMS is seeking comments through March 30, 2026, inviting hospitals, suppliers, and supply chain providers to help shape the new regulation.

Tariff updates

No new U.S. tariffs have taken effect since November 2, 2025, underscoring the gap between policy discussions and actual implementation. In the coming months, two big issues have the potential to change the trade environment again or give companies breathing room to optimize their sourcing strategies:

• A Supreme Court decision will determine whether the U.S. administration was justified in invoking a national emergency to levy certain tariffs and whether these tariffs will stand or possibly be refunded. Court watchers expect the decision in the second half of February at the earliest. The case pertains to global reciprocal tariffs and tariffs intended to stop the flow of illegal drugs. The case does not pertain to tariffs on specific commodities such as steel, aluminum, and copper used in medical devices that were levied under a different type of authority.
• U.S.-Mexico-Canada Trade Agreement (USMCA) review is under way. These negotiations may result in changes to the North American trade deal, likely mid-year.

Furthermore, the U.S. administration announced it may raise tariffs on South Korean imports, saying the country has not lived up to its end of the trade deal made in 2025. It’s important to note this is an ongoing policy discussion and has not progressed to implementation. If implemented, these tariffs could impact pharmaceuticals, with rates expected to increase from 15% to 25%.

For more information, including news of a U.S.-India trade deal, go to the Trade Policy & Customs section of this report.

Free trade zones vs. bonded warehouses: Finding the right choice for pharma

As global trade policies continue to shift, pharmaceutical shippers are looking for ways to strengthen their resilience while managing cost and compliance risk. Two tools, foreign trade zones (FTZs) and bonded warehouses, offer duty deferral and inventory-management advantages, but they function differently and carry distinct benefits for high-value, tightly regulated pharmaceutical products.

An FTZ operates inside the United States but is legally treated as outside U.S. Customs territory, enabling companies to store, manipulate, or even manufacture products indefinitely without paying duties until the goods enter U.S. commerce. This flexibility allows importers to relabel, repackage, test, or re-export inventory while avoiding duties—an important advantage in a sector where quality checks and batch failures are common.

A bonded warehouse, by contrast, sits within U.S. Customs territory and is best suited for short-term, lower-volume storage. Duties are deferred but must be paid eventually, and goods can only remain for up to five years while far more limited activities with them are permitted. Typically, these include inspection, repackaging, or labeling under customs supervision. While compliance is simpler and setup costs are lower, bonded warehouses do not offer the manufacturing flexibility, tariff planning advantages, or long-term storage options that many pharmaceutical companies now require.

A logistics provider with expertise in both trade policy intricacies and the healthcare industry can help make smart choices for pharmaceutical supply chains.

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