Will he or won’t he?

It’s anyone’s guess at this point. Depends on the day, really. Or hour.

Keeping track and making sense of the Trump Administration’s constant flip-flop fiats on tariffs and lean government has been an exercise in futility, to say the least.

It’s almost as if the president has been seeking guidance from the Magic 8 Ball.

At his inauguration, for example, Trump vowed to impose a 25% surcharge on Canadian and Mexican imports beginning Feb. 1 (Magic 8 Ball tip: Without a Doubt) but delayed them a month at the final hour.

Magic 8 Ball’s advice? Reply Hazy, Try Again.

Second try: It is Decidedly So. Hence, Trump signed a memorandum in mid-February to enact across-the-board tariffs on April 2. 

Then at a late February Cabinet meeting—in a fleeting moment of clarity, perhaps—Trump reportedly considered delaying Canadian and Mexican tariffs until April 2. Magic 8 Ball urges him to Concentrate and Ask Again. He does. Magic 8 Ball says Outlook Good, so Trump abandoned the deferment idea and set a March 4 implementation date.

Tariffs against Mexico, China, and Canada took effect that day but with a Reply Hazy, Try Again retort from Magic 8 Ball, Trump delayed tariffs on Mexican goods two days later and eventually granted Canada the same one-month respite. 

Reply Hazy, Try Again.

Merely 24 hours after extending the reprieve to Canada, though, Trump threatened new tariffs on the country’s lumber and dairy products, promising to meet its roughly 250% tariff on U.S. dairy exports dollar for dollar.

Cannot Predict Now.

Ask Again Later.

Reply Hazy, Try Again.

Most likely.

Cannot Predict Now. 

The Trump Administration’s crystal ball-like approach to fair trade is spawning tremendous uncertainty and anxiety for the medtech sector. Companies have mostly skirted the issue, leaving lobbying efforts (and formal objections) to trade groups like AdvaMed and the American Hospital Association. Both organizations have urged the Trump Administration to waive tariffs for medical devices and pharmaceuticals, warning the levies could undermine disease diagnosis and treatment, and jeopardize patient safety.

While the industry endured similar uncertainty during Trump’s initial go-round with tariffs in 2018, his latest protectionist provisions are truly concerning for companies, as they threaten healthcare’s supply chain stability.

“When I’ve spoken to other industries, there seems to be more flexibility and more resilience in the manufacturing ecosystem that they live in,” noted Phillip Gulley, co-founder/chief strategy officer at Cofactr, a Brooklyn, N.Y.-based supply chain and logistics management platform that streamlines production, processes, and policies for critical hardware manufacturers. 

“Specifically in medtech, when I’ve spoken with smaller organizations, their concern is that this is an existential threat,” he continued. “There’s a tariff and cost involved and a level of destabilization to my supply chain that leads me to a position where I would not have the ability to maintain operations to continue to be a company because our SKU count is low. And that instability might just throw us into a nightmare scenario that we can’t escape. The larger manufacturers don’t have transparency, don’t have visibility, and are scrambling to figure out what they need to do.”

Better supply chain visibility would be a good start. Companies that source raw materials and medical components from China and other tariff-targeted countries are facing increased production costs they cannot necessarily pass on to customers. Consequently, they must re-evaluate their supply chains in real time.

“…large manufacturers who are trying to understand their exposure to different markets because they have historically relied on [outside] manufacturers to outsource a lot of these capabilities might not have the data on hand to get a clear understanding of what the strategy should be for managing tariffs, or rejiggering their supply chains,” Gulley explained. They [manufacturers] might own a chunk of their supply chain, but they are getting sub-assemblies or materials from international markets and often don’t have visibility into the sourcing of all of those geared manufacturer sources. So there’s a scramble right now to understand exposure and ultimately they don’t know what the implications are going to be.”

To gain better supply chain visibility, Gulley suggests medtech firms contact their tiered manufacturing partners and request a bill of materials to gain a better understanding of their exposure risk in different geographical regions. ”It’s about understanding the implication, and then trying to move forward as responsibly as you can,” he said.

Maybe Magic 8 Ball can help.

Don’t Count on It.