First off, the accord officially establishes a 15% tariff rate for pharmaceuticals from the EU, a top source of U.S. drug imports. Generic pharmaceuticals will be exempt from the new agreement, meaning such drugs will face a roughly 2.5% tariff rate in place prior to the Trump administration.

The EU and the US have signed a joint statement to retroactively reduce US tariffs on cars and car parts from 27.5% to 15%, contingent upon the EU initiating

In July, Trump had threatened to lift pharmaecutical tariffs to 200%, but speaking on CNBC on 5 August, Trump said they could eventually go as high as 250%. "We want pharmaceuticals made in our country," he told CNBC.