Pharma firms are calling for clarity on tariffs imposed under the new U.S.-EU trade agreement, as analysts warn that punitive sector-specific levies could risk blowing up the entire deal. Ambiguity abounds around the terms for pharmaceutical goods under the trade truce agreed Sunday, which imposes 15% tariffs on EU goods imported to the U.S.

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Many pharmaceutical products made in Europe will face a 15 percent tariff, pinching manufacturers and potentially leading to higher drug prices.

Part of the agreement involves a commitment to buy American oil and gas. Over the course of the Russia-Ukraine war, now in its fourth year, most of the EU has slashed its dependence on unreliable energy supplies from Russia, but Hungary and Slovakia still have not.

Trump had most recently threatened tariffs of 30% on imports from the European Union. But on Sunday, he met with the president of the European Commission, and they agreed to a lower level.

German auto companies embraced greater clarity but warned that even the lower rate of tariffs agreed between Brussels and Washington would still hurt.

The 15% rate is higher than the current 10% tariff rate on European luxury goods. Investors may have wanted better terms for the sector.

The EU 15% tariff will raise prices on European consumer brands from luxury, autos, food and beauty. This could reduce demand and make US-based brands more competitive.