Xeris Biopharma’s Resilience Shines Despite Tariff Turbulence

Tariffs on April 2: Big Talk, Limited Bite for Pharma

Investors braced for the worst when President Trump announced “reciprocal tariffs” on April 2, 2025 – an aggressive move that some early reports hinted could mean a blanket 25% duty on all imports. In fact, Trump had publicly floated imposing 25% (or higher) tariffs on broad sectors like automobiles, semiconductors and pharmaceuticals just weeks prior (New reciprocal, car, drug, and semiconductor tariff threats | Grant Thornton), stoking fears of a hefty across-the-board import tax. Fortunately, those fears proved overblown. The actual tariff plan unveiled was far more measured and strategic than a flat 25% hit on everything.

Instead of a one-size-fits-all 25% tariff, the White House set a new baseline 10% tariff on imports from all countries (What’s in Trump’s sweeping new reciprocal tariff regime | Reuters). On top of this base, higher rates will apply only to certain nations deemed to have unfair trade practices or high barriers against U.S. goods. For example, imports from the European Union face a 20% U.S. tariff, Japan 24%, South Korea 25%, India 26%, Taiwan 32%, Thailand 36%, and Vietnam up to 46% (What’s in Trump’s sweeping new reciprocal tariff regime | Reuters). China, which the administration targeted due to its large trade surplus, will see a 34% tariff (effectively 54% when including prior fentanyl-related duties) (What’s in Trump’s sweeping new reciprocal tariff regime | Reuters). Many U.S. allies, however, remain at the base 10% rate; for instance, the U.K., Brazil, and Singapore were assigned only the 10% minimum (What’s in Trump’s sweeping new reciprocal tariff regime | Reuters). In short, the initial rumor of a blanket 25% tariff was inaccurate – the reality is a tiered system aimed at specific countries, with most partners seeing much lower rates.

Crucially for healthcare investors, pharmaceutical products were explicitly spared from these new tariffs. A White House fact sheet confirmed that pharmaceuticals are excluded from the import duties (an important clarification after some news outlets initially misreported otherwise) (Pharmaceuticals excluded from tariffs announced by Trump (VTRS:NASDAQ) | Seeking Alpha). Even President Trump’s executive order carved out protections: sectors under national security review – including pharmaceuticals – are exempt from the reciprocal tariffs (What’s in Trump’s sweeping new reciprocal tariff regime | Reuters). Thanks to this exemption, drugs and key drug components won’t be subject to the extra import taxes. Bottom line: the sweeping tariffs may rattle many industries, but the pharma sector dodged the blow (Pharma stocks survive market rout on tariff exemption, but uncertainty continues | Reuters), greatly limiting any direct impact on companies like Xeris Biopharma.

Xeris Biopharma’s Insulated Operations

Xeris Biopharma (NASDAQ: XERS) is particularly well-positioned to weather this tariff storm with minimal disruption. The company’s supply chain and manufacturing footprint are largely U.S.-based or in allied nations, insulating it from tariff-targeted regions. For instance, Xeris secures its drug production through partnerships with trusted suppliers: it sources the active pharmaceutical ingredient (API) from Bachem Americas (the U.S. arm of Switzerland’s Bachem), utilizes Pyramid Laboratories in California for drug formulation and fill-finish, and relies on SHL Pharma’s Florida facility for auto-injector device assembly ([PDF] Form 10-Q for Xeris Biopharma Holdings INC filed 08/10/2022). These arrangements mean the critical components of Xeris’ products are made domestically or in countries not facing punitive tariffs. The company has limited exposure to China or other high-tariff jurisdictions – a fact underscored by industry analyses during the pandemic, which noted Xeris had “limited exposure to Chinese supply” compared to other pharma firms (How are pharma supply chains reacting to COVID-19? Without info …). In other words, Xeris isn’t dependent on importing bulk materials from China, Southeast Asia or other regions now seeing tariff rates of 25%–45%. Its North American-centric supply chain provides a natural shield.

Even in cases where Xeris uses a specialized component from abroad, the pharma tariff exemption offers protection. For example, any imported medical device parts for its Gvoke® HypoPen (a glucagon auto-injector) would fall under “medical device” categories, which do not enjoy the pharma exemption. However, these device components represent a relatively small portion of product cost and, in Xeris’ case, are assembled in the U.S. by SHL Pharma. This domestic final assembly may allow the product to qualify under trade agreements or at least minimize dutiable value. Moreover, if a 10–20% tariff were applied to certain device hardware imported from a country like Taiwan (tariff rate 32% for Taiwan under the new rules (What’s in Trump’s sweeping new reciprocal tariff regime | Reuters)), the impact on Xeris’ margins would be marginal and likely manageable through cost adjustments or sourcing tweaks. The vast majority of the value in Xeris’ products comes from the drug substance and formulation – which are exempt, produced domestically, or sourced from U.S. partners.

Operationally, Xeris has been emphasizing its domestic manufacturing and distribution infrastructure, which aligns well with the current political climate favoring U.S. production. President Trump has repeatedly urged the pharma industry to invest in U.S. manufacturing (Pharma stocks survive market rout on tariff exemption, but uncertainty continues | Reuters), and Xeris is essentially ahead of the curve on this front. The company’s main commercial products – Gvoke (for severe hypoglycemia), Keveyis® (for periodic paralysis), and Recorlev® (for Cushing’s syndrome) – are manufactured in North America. This not only reduces supply chain complexity and shipping costs, it also means little to no direct tariff exposure for importing finished goods. Xeris is not reliant on importing finished drugs from Europe or Asia that would suddenly become 20%+ more expensive. Its strategy of localized production is paying off in the current environment.

What about Xeris’s sales footprint? Here too, the company is largely insulated. Xeris generates the bulk of its revenue in the United States, so it faces minimal risk from any foreign retaliatory tariffs or lost overseas sales. The newly announced U.S. tariffs target dozens of countries, but none of Xeris’ key markets are in the crosshairs. In fact, Xeris is still in the early stages of international expansion. Aside from a recently signed distribution agreement to bring Gvoke to Israel (News Release – Xeris Pharmaceuticals) and supplying some patients in Europe on a special-order basis, Xeris has no broad commercial operations in the EU, China, or India yet. Those regions facing higher U.S. tariffs are not yet part of Xeris’ revenue stream – meaning there’s no direct hit to the company’s sales if trade tensions rise. For example, Europe’s 20% tariff rate or India’s 26% rate apply to goods coming into the U.S. (What’s in Trump’s sweeping new reciprocal tariff regime | Reuters), not to Xeris’s exports. And since Xeris isn’t exporting meaningful volumes there (nor importing critical materials from there), the effect is negligible. Even if Europe or other partners retaliate with tariffs of their own, medicines are often excluded from such measures (as we’ve seen with the U.S. exemption) (Trump imposes double-digit import taxes on nearly all countries). The countries targeted by Trump’s tariffs do not significantly overlap with Xeris’ operational footprint, a reassuring fact for investors. Xeris’ revenue will continue to come primarily from U.S. patients and payers, uninterrupted by trade wars.

Market Shrugs Off Tariff Fears – Analyst Confidence Remains High

The resilience of Xeris Biopharma’s business model in the face of these tariffs is reflected in the market’s reaction. Far from panicking, investors have largely shrugged off the tariff news when it comes to pharma and biotech stocks. On the morning after Trump’s announcement, while broad market indices and tariff-sensitive sectors (like industrials and tech) plunged, pharmaceutical shares barely blinked. U.S. drugmakers’ stocks were mostly flat to only slightly down in pre-market trading, moves that were “muted compared to other sectors,” according to Reuters (Pharma stocks survive market rout on tariff exemption, but uncertainty continues | Reuters). For example, Johnson & Johnson shares rose a touch, and declines at other major pharma names were well under 1% (Pharma stocks survive market rout on tariff exemption, but uncertainty continues | Reuters). This relative strength underscores that investors understand pharma companies face minimal direct impact. Xeris Biopharma’s stock likewise saw no significant selloff on the tariff news, a sign that the market does not expect any material hit to Xeris’ costs or growth. In fact, Xeris’ stock has been on an upward trajectory, recently touching 12-month highs ( Xeris Biopharma (NASDAQ:XERS) Given “Buy” Rating at HC Wainwright ). The company’s shares traded around the mid-$4 range in March – up dramatically from last year’s lows – indicating that investors are focusing on Xeris’ robust growth outlook and not on trade headlines.

Wall Street analysts also remain firmly bullish on Xeris and have not flagged the tariffs as a concern. If anything, analyst coverage highlights the company’s strong fundamentals and long-term potential. Within the last few months, we’ve seen price target upgrades for XERS stock, reflecting growing confidence in the firm’s trajectory. Notably, Jefferies Financial Group reiterated their positive view in late January and raised their price target from $4 to $6 ( Xeris Biopharma (NASDAQ:XERS) Given “Buy” Rating at HC Wainwright ), citing Xeris’ solid execution. In March, H.C. Wainwright reaffirmed a Buy rating and boosted their target to $8 (from $6.60) ( Xeris Biopharma (NASDAQ:XERS) Given “Buy” Rating at HC Wainwright ) – a striking vote of confidence and now one of the highest targets on the Street. These analysts are focused on Xeris’ accelerating revenues and pipeline progress, and importantly, none have suggested that the new tariffs will alter their earnings models or outlook for the company. No downgrades or negative revisions followed the tariff announcement; on the contrary, Xeris maintains a consensus recommendation in the “buy” range ( Xeris Biopharma (NASDAQ:XERS) Given “Buy” Rating at HC Wainwright ). This suggests that those closest to the fundamentals agree the reciprocal tariffs pose little more than a headline risk, not a real business risk, for Xeris.

It’s also worth noting that within the broader healthcare sector, some experts actually see a relative advantage for companies like Xeris under the new trade regime. With pharmaceuticals exempt from tariffs by the U.S. (Pharma stocks survive market rout on tariff exemption, but uncertainty continues | Reuters), but no such explicit protection for medical devices or other sectors, capital may rotate into biopharma names as a safer haven during trade turmoil. In India, for example, pharma stocks jumped 3–13% on relief that Trump spared the drug industry (Trump Reciprocal Tariffs: Pharma shares rise up to 13% on … – Mint). Similarly, European pharma outperformed their markets after the announcement (Pharma stocks survive market rout on tariff exemption, but uncertainty continues | Reuters). This dynamic bodes well for Xeris: investors seeking growth companies unencumbered by tariff fallout may increasingly gravitate to small- and mid-cap biopharmas with domestic focus. Xeris fits that bill perfectly.

Long-Term Resilience and Opportunity

Stepping back, Xeris Biopharma’s long-term growth story remains as strong as ever, with or without tariffs. The company is coming off a record 2024 performance – posting $203 million in revenue (24% growth year-over-year) and turning cash flow positive by Q4 (Xeris Biopharma Delivers Record Fourth Quarter and Full-Year 2024 Results; and Announces 2025 Guidance – BioSpace) (Xeris Biopharma Delivers Record Fourth Quarter and Full-Year 2024 Results; and Announces 2025 Guidance – BioSpace). For 2025, Xeris has guided to $255–$275 million in revenue (30%+ annual growth) (Xeris Biopharma Delivers Record Fourth Quarter and Full-Year 2024 Results; and Announces 2025 Guidance – BioSpace) (Xeris Biopharma Delivers Record Fourth Quarter and Full-Year 2024 Results; and Announces 2025 Guidance – BioSpace), a target the recent tariff policy does nothing to impede. Xeris’ three commercial products are all gaining traction (in fact, Recorlev’s sales doubled in 2024 (Xeris Biopharma Delivers Record Fourth Quarter and Full-Year 2024 Results; and Announces 2025 Guidance – BioSpace)), and its pipeline of novel formulations promises additional upside in the coming years. The company’s management has emphasized “unrelenting focus on execution” and creating value for shareholders (Xeris Biopharma Delivers Record Fourth Quarter and Full-Year 2024 Results; and Announces 2025 Guidance – BioSpace) – a focus made easier now that they don’t have to worry about a tariff hit to their cost structure. If anything, Xeris’ largely U.S.-based operations align nicely with a macro environment that favors domestic manufacturing. The firm may even benefit from potential U.S. policy incentives for pharmaceutical production at home, further strengthening its position.

Crucially, Xeris has shown it can navigate external challenges with agility. During the COVID-19 supply chain disruptions, Xeris managed to supply its medicines without significant issue (thanks to its limited China exposure and strong supplier relationships). The new trade tariffs similarly appear to pose no material threat. Xeris has multiple ways to mitigate any minor cost increases – from strategic stockpiling of critical components to qualifying secondary suppliers if needed – though at this point such measures may not even be necessary given the exemptions in place. The company’s leadership and operations team have effectively “stress-tested” the supply chain in recent years and built resilience into the system. This means investors can have confidence that Xeris will continue delivering products to patients on time and on budget, regardless of geopolitical trade skirmishes.

From a strategic standpoint, Xeris can actually turn this moment into an opportunity. While some competitors might scramble to rejigger supply chains or face higher import costs, Xeris can stay focused on growth initiatives – like expanding its U.S. market penetration and preparing for international launches on its own terms. When Xeris does eventually enter tariff-affected markets (e.g. the EU or other regions), it will likely do so through local partnerships or manufacturing that sidestep import duties, just as it has done domestically. In essence, Xeris controls its destiny far more than most small-cap biotechs, which often depend on global supply networks. That self-reliance is a strategic asset that is being undervalued by the market, and the current tariff situation shines a light on it.

The Bullish Verdict

All the evidence points to one conclusion: the reciprocal tariffs announced on April 2 will have minimal impact on Xeris Biopharma’s operations and growth prospects. The initial scare of a 25% across-the-board import tax turned out to be a false alarm, and the tailored tariff policy that is going into effect largely excludes pharmaceuticals and does not touch Xeris’ core business (Pharma stocks survive market rout on tariff exemption, but uncertainty continues | Reuters). Xeris’ supply chain is domestically anchored and resilient, its international exposure is limited and strategic, and its financial momentum is strong. Market behavior and analyst commentary both affirm that Xeris remains on track to execute its plan without missing a beat.

For investors, the take-home message is optimistic: Xeris Biopharma is built to thrive even amid trade wars and volatility. Temporary noise around tariffs hasn’t changed the intrinsic value of the company. Xeris continues to deliver life-saving therapies, grow its revenue at a double-digit clip, and chart a path to sustainable profitability – all while dodging the potential landmines that tariff escalation could pose to others. If anything, any undue stock weakness tied to macro trade headlines could be a buying opportunity for a fundamentally strong, tariff-insulated biotech like Xeris. With its solid domestic foundation and innovative product portfolio, Xeris is poised for long-term success, proving that a nimble biopharma can indeed weather global storms. In the face of tariffs and beyond, Xeris Biopharma’s outlook remains decidedly bullish and full of promise.

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