Weight loss drugs are blowing up the U.S. trade deficit. Trump is blaming Ireland

Less than 25,000 pounds of freeze-dried hormones — equivalent to the weight of a few Cybertrucks — are upending America’s trade relationship with Ireland.

The hormones, a key ingredient in blockbuster weight loss drugs like Eli Lilly’s Mounjaro and Zepbound, are so valuable that their combined $36 billion price tag has helped push Ireland into the No. 2 spot for the U.S.’s largest goods trade deficit, behind only China.

Pharmaceutical compounds now account for nearly half of all U.S. imports from Ireland, with most bound for Lilly’s Indiana headquarters. Thus, Eli Lilly and other drug companies appear to have significantly increased orders in recent months in an attempt to get ahead of trade-policy chaos.

This kind of stockpiling has contributed to the ballooning trade deficit — and drawn unwelcome attention from the White House.

Now, President Donald Trump is preparing to punish one of America’s closest allies, and some of its most important pharmaceutical companies, for the fallout of his own policies. By triggering a rush to front-load shipments ahead of tariff deadlines, Trump helped inflate the very deficit he’s now blaming on Ireland.

A surreal collision

As The Wall Street Journal notes, it’s a surreal collision: the global boom in weight loss drugs, tangled supply chains, America’s complex relationship with obesity, and Trump’s second term, with its endless tariff threats and reversals that leave businesses scrambling to adapt.

Surreal or not, the fallout is real. Trump has relaunched a Section 232 investigation that could lead to sweeping new tariffs on imported drugs and ingredients. His stated goal is to bring pharmaceutical manufacturing back to U.S. soil. But that’s easier said than done.

How Ireland became a major pharma supplier

Ireland became a a pharmaceutical hub over the last several decades as the country cultivated the industry with a mix of government incentives and its highly educated, English-speaking workforce. U.S. drugmakers like Eli Lilly, Pfizer, and Merck flocked there to take advantage of the 12.5% corporate tax rate — one of the lowest in the developed world — as well as streamlined regulatory oversight and strong intellectual property protections.

Its EU membership has also made it a strategic springboard. Companies can manufacture within the bloc and export globally with minimal friction.

Correspondingly, over time, Ireland has built deep expertise in advanced drug manufacturing, even for the most complex medicines and therapies. The result is a dense cluster of high-tech factories that produce some of the world’s most profitable drugs — from Botox to Keytruda to the weight loss therapies now dominating U.S. air cargo lanes.

What happens next is hard to predict

Trump's revived Section 232 investigation is an echo of his first administration, when he floated a similar measure. However, that measure never advanced very far. This time out, the investigation is formal and potentially sweeping.

Critics argue the move could end up destabilizing supply chains for life-saving medicines, among other detrimental effects. As experts understand, this kind of production — delicate, capital-intensive, and tightly regulated — can’t just be turned on like a faucet. By extension, Ireland’s decades-long role as a pharma hub can’t be replaced or undone quickly, no matter how many factories the U.S. builds.

In any case, the irony is hard to miss: the trade imbalance Trump helped to create is now one he apparently sees as a catalyst for investigation and punishment. That it's happening under the guise of "national security" makes it even more surreal.