25% Tariff Proposed on Imported Orthopedic Products

This week, the Office of the United States Trade Representative issued a notice that it intends to impose a new 25% tariff on a large number of medical devices and drugs, including orthopedic products imported from China.

The wording of the proposed rule is unambiguous. All “orthopedic or fracture appliances, and parts and accessories thereof and all artificial joints and parts and accessories, thereof” coming from China would be subject to this proposed 25% tariff.

While the U.S. is the largest supplier of orthopedic products around the world, U.S. based suppliers routinely use components which are manufactured in China.

At the just completed American Academy of Orthopaedics Surgeons (AAOS) annual meeting, for example, 38 Chinese origin companies had booths—the most from a country outside the U.S.

They were selling to both the attending physicians AND to other exhibiting companies.

The notice sets in motion a period of public commentary. All written comments are due May 15, 2008. The due date for post-hearing rebuttal comments is May 22, 2018.

Then, if nothing changes, orthopedic products and components and a long list of medical devices (MRIs, CTs, syringes, catheters, for example) and their components coming from China will become more expensive.

Will China retaliate?

And if it does, will the fact that a significant portion of orthopedic products are manufactured in Indiana, the home of Vice President Mike Pence, make this industry particularly vulnerable?

We will stay on top of this and report on all public comment.

The following is a partial list of the medical devices, orthopedic products and other medical products which the U.S. government is proposing to tax.