US drug pricing reforms and tariffs are upending long-standing assumptions behind intercompany intangible property transactions, forcing life sciences companies to rethink how profits will be generated across markets.
In the article “Drug Pricing Rules and Tariffs Reshape Transfer Pricing for IP,” published in Bloomberg Tax, CRA’s Transfer Pricing experts Robin Hart and Arin Mitra explore how changing pricing dynamics can affect cost-sharing arrangements and licensing structures.
These are the key points covered in the article:
- Policy shifts are reshaping profitability assumptions
- Heightened IRS scrutiny creates retroactive risk
- Proactive documentation is critical
The authors conclude that firms must proactively reassess forecasts, document assumptions, and ensure intercompany arrangements remain aligned with evolving economic realities to mitigate risk.
Read the full article here.
