Insulin, heart treatments and antibiotics have flowed freely across many borders for decades, exempt from tariffs in a bid to make medicine affordable. But that could soon change.

For months, President Trump has been promising to impose higher tariffs on pharmaceuticals as part of his plan to reorder the global trading system and bring key manufacturing industries back to the United States. This month, he said pharmaceutical tariffs could come in the “not too distant future.”

If they do, the move would have serious — and wildly uncertain — consequences for drugs made in the European Union.

Pharmaceutical products and chemicals are the bloc’s No. 1 export to America. Among them are the weight-loss blockbuster Ozempic, cancer treatments, cardiovascular drugs and flu vaccines. Most are name-brand drugs that yield a large profit in the American market, with its high prices and vast numbers of consumers.

“These are critical things that keep people alive,” said Léa Auffret, who heads international affairs for BEUC, the European Consumer Organization. “Putting them in the middle of a trade war is highly concerning.”

European companies could react to Mr. Trump’s tariffs in a range of ways. Some pharmaceutical companies trying to dodge the tariffs have already announced plans to increase production in the United States, which Mr. Trump wants. Others could decide to move production there later.

Other companies appear to be staying put, but could raise their prices to cover the tariffs, pushing up costs for patients. And higher prices could affect not only American consumers, but also patients in Europe. Some companies have begun to argue that Europe should create more favorable conditions for their businesses by dismantling some of the rules that keep drug prices down.

Or some middle ground could play out: Companies might shift their financial profits to the United States for accounting purposes to avoid import charges, even as they leave their physical factories overseas to avoid the expenses of moving and challenges of having to set up new supply chains.

Ms. Auffret’s group has already warned European officials that they must not hit back at an attack on the important industry by tariffing American drugs in return: Tit for tat would come at too serious of a cost to European consumers.

But the pharmaceutical sector is complicated. Agreements with insurance companies and government agencies can make it difficult to rapidly adjust prices for branded drugs, while government regulations can make moving both a challenge and a long-term commitment. The upshot is that no one can confidently predict the outcome.

“We haven’t tariffed pharmaceuticals in a very long time,” said Brad W. Setser, an economist at the Council on Foreign Relations who has closely studied the tax rules that incentivize overseas production.

Even as Mr. Trump has paused his so-called “reciprocal” tariffs in favor of an across-the-board rate of 10 percent during the hiatus, he has left in place some industry-specific tariffs and made clear that computer chips and pharmaceutical products would be next. The United States recently kicked off investigations into both sectors, a first step toward hitting them with tariffs.

Many industry experts expect that the new tariffs could be 25 percent, in line with those on steel, aluminum and cars.

For the countries at the center of Europe’s drug industry, the possible tariffs are particularly worrisome. That is especially true for Ireland, where pharmaceuticals make up 80 percent of all exports to the United States.

Many drug companies originally moved to Ireland because it offers very low corporate tax rates. But it has also worked to develop its pharmaceutical industry and offers access to a highly skilled work force.

In recent years, the sector has grown rapidly. More than 90 pharmaceutical companies are now based there, according to Ireland’s Foreign Direct Investment Agency, and many of the biggest American drugmakers have operations in the nation. Last year, Ireland’s pharma industry exported 58 billion euros, or about $66 billion, in pharmaceutical and chemical products to the United States.

“The Irish are smart, yes, smart people,” Mr. Trump said in March, while Prime Minister Micheál Martin of Ireland was visiting the White House. “You took our pharmaceutical companies and other companies,” he said. “This beautiful island of five million people has got the entire U.S. pharmaceutical industry in its grasps.”

Now, tariffs could chip away at the benefits of manufacturing there — which is Mr. Trump’s goal.

“In the U.S., we don’t make our own drugs anymore,” Mr. Trump said last week from the Oval Office, adding that “the drug companies are in Ireland.”

Firms are already bracing. Companies have been rushing to export their pharmaceuticals from Ireland and into the U.S. market before the gauntlet falls, statistics suggest.

Nor is Ireland the only country affected. Germany, Belgium, Denmark and Slovenia are also major exporters.

“It’s an enormous issue for Europe,” said Penny Naas, who leads a competitiveness program for the think tank the German Marshall Fund and has long worked in European public policy and corporate affairs.

European leaders have been reaching out to both American officials and the industry. In addition to the Irish prime minister’s recent visit to the Oval Office, the Irish foreign affairs minister traveled to Washington to meet with the commerce secretary.

Ursula Von der Leyen, the president of the European Commission, the European Union’s executive arm, has met in Brussels with the European Federation of Pharmaceutical Industries and Associations, the lobby group representing Europe’s biggest drugmakers.

The industry is leveraging the moment to push for wish-list items, like less red tape.

The European drug lobby group told Ms. von der Leyen that companies could shift production or investment toward the United States to limit their exposure to Mr. Trump’s tariffs, especially when faster approvals and easier access to capital are making America more attractive.

At least 18 members of the group, which includes Bayer, Pfizer and Merck, have planned nearly €165 billion in investments in the European Union over the next five years. As much as half of that could shift to the United States, the federation said. Nor is it alone in that prediction.

“Pharma needs more attractive conditions to produce in Europe,” said Dorothee Brakmann, the director of Pharma Deutschland, Germany’s largest association of pharmaceutical companies.

Such warnings seem to have teeth. Some companies have begun to lay out plans to spend more in the United States; the firm Roche last week announced a $50 billion American investment plan, the latest in a string of such announcements.

In commentary published last week, the chief executives of Novartis and Sanofi suggested that less regulation was not enough to stem the bleeding. They argued that “European price controls and austerity measures reduce the attractiveness of its markets,” and that the bloc should pave the way for higher prices.

Industry executives have also warned that tariffs on the sector could disrupt supply lines, impair patient access and dampen research and development.

“There’s a reason” that tariffs on medicines are set to zero, Joaquin Duato, the chief executive of the drugmaker Johnson & Johnson, said on a recent earnings call. “It’s because tariffs can create disruptions in the supply chain, leading to shortages.”

Ms. von der Leyen has emphasized similar concerns, warning that tariffs on the pharmaceutical sector risk “implications for globally interconnected supply chains and availability of medicines for European and U.S. patients alike.”

Pharmaceutical tariffs also hold another danger for the European Union.

The bloc has been trying to build up its ability to manufacture generic drugs, which are medically essential but much less profitable than the name-brand products, and are frequently made in Asia.

But if U.S. tariffs mean that generic drug manufacturers in China and India are suddenly looking for customers outside of America, it could send a flood of cheaper-than-usual pills toward Europe.

That could make it even more difficult for the European Union to establish a domestic manufacturing base for generics, even as tariffs lure name-brand drug production toward the United States.

“We do think that it’s likely that this is going to cause increased investment in the U.S.,” said Diederik Stadig, a sectoral economist at ING. “The European Commission needs to be on the ball.”

On the sidelines of the spring meetings of the International Monetary Fund and World Bank this week, Treasury Secretary Scott Bessent tried to convey an important message about the United States dollar.

Speaking to a crowd of global policymakers, regulators and investors, Mr. Bessent sought to allay fears that had ballooned in recent weeks about the dollar’s global standing and the country’s role as the safest haven during times of stress. He reiterated that the administration would continue to have a “strong-dollar policy” and affirmed that it would remain the currency that the rest of the world wanted to hold, even though it had weakened against most major currencies.

For participants at the event, Mr. Bessent’s comments were a needed salve after a bruising couple of weeks in financial markets as a result of President Trump’s trade war. Violent swings in stocks, coinciding with the weakening of the dollar as investors fled U.S. government bonds, had incited panic.

The fact that Mr. Bessent found it necessary to emphasize that message in front of such a big crowd underscored how precarious the situation had become since Mr. Trump returned to the White House less than 100 days ago. What now looms large are uncomfortable questions about what happens if the international community starts to lose faith in the dollar and other U.S. assets, something that economists warn would be costly for Americans.

“People are playing through scenarios that previously had been judged unthinkable, and they’re playing them through in a very serious kind of way in the spirit of contingency planning,” said Nathan Sheets, the chief economist at Citigroup and a Treasury official in the Obama administration.

“If the United States is going to pursue aggressive economic policies, it’s natural for the rest of the world to step back and say, ‘Well, do we want to buy U.S. assets as we have in the past?’”

‘New World Order’

At a similar gathering hosted by the I.M.F. and World Bank six months ago, attendees were preparing for an entirely different economic backdrop. Convening less than two weeks before the presidential election, they still had in their sights a rare soft landing in which the major central banks finished their fight against high inflation while managing to avoid a recession.

The tariffs Mr. Trump had been talking about on the campaign trail were top of mind, but for the most part, they were viewed as a negotiating tactic. Any turn toward protectionism was widely expected to push up the value of the dollar compared with other currencies. The rationale was that tariffs would lower demand for imported goods, since they would make them more expensive for American consumers, and over time result in fewer dollars being exchanged for foreign currencies.

But since Inauguration Day, the opposite has occurred. An index that tracks the dollar against a basket of major trading partners has fallen nearly 10 percent in the last three months. It now hovers near a three-year low. The sharpest slide came after Mr. Trump announced large tariffs on nearly all imports in April. While he temporarily reversed course, the dollar has yet to recoup its losses.

There are reasons not to read too much into its recent weakening. The U.S. economic outlook has fundamentally changed. Businesses are “frozen” by tariffs, Christopher J. Waller, a governor at the Federal Reserve, said this week as he warned about layoffs stemming from the uncertainty.

Economists have sharply scaled back their estimates for growth while raising their estimates for inflation, a combination that carries a whiff of stagflation. In that environment, it is not surprising that the dollar and other U.S. assets appear less appealing.

Dollar depreciation — even if extreme — also does not necessarily translate to a loss of stature in the global financial system. There have been previous big drops in the value of the dollar that have not incited a wholesale shift away from the currency’s primacy, said Jonas Goltermann, the deputy chief markets economist at Capital Economics.

But at this year’s spring meetings, there was a palpable sense that something more ominous could be taking place. Joyce Chang, JPMorgan’s chair of global research, noted a disconnect between domestic and international participants at the conference that the Wall Street bank hosted during the week of the meetings.

U.S.-based investors appeared less concerned about a structural shift away from the country’s assets and more focused on the ways in which Mr. Trump could course-correct on his economic policies. International investors were consumed by the prospects of a “regime change” in the financial system and a “new world order,” Ms. Chang said.

Mr. Trump had recently escalated his attacks on Jerome H. Powell, the Fed chair, fanning fears about how much the administration would encroach on the central bank’s independence. That longstanding separation from the White House is broadly seen as essential to the smooth functioning of the financial system.

“The dollar’s role in the system was not ordained from above,” said Mark Sobel, a former Treasury official who is the U.S. chairman of the Official Monetary and Financial Institutions Forum. “It’s a reflection of the properties of the United States.”

Those include a large economy that transacts with the world; the financial system’s deepest, most liquid capital markets; a credible central bank; and the rule of law.

“I do believe that Trump is doing permanent damage,” Mr. Sobel said.

Few Alternatives

It is hard to overstate the dominance of the dollar globally, meaning there are real limitations to how significantly private and public investors can diversify away from it, even if they want to.

Most trade is invoiced in dollars. It is the leading currency for international borrowing. Central banks also prefer to hold dollar assets more than anything else, and by a wide margin.

“Anybody who’s looking for diversification has to be realistic,” said Isabelle Mateos y Lago, the chief economist at BNP Paribas. “Reserve assets, by definition, have to be liquid.”

Alternatives do exist, but they are hobbled by their own weaknesses. China lacks open, deep and liquid capital markets, and its currency does not float freely, tarnishing its appeal globally. Top European leaders — including Christine Lagarde, the president of the European Central Bank — have talked more readily about bolstering the prominence of the euro, something that is considered more plausible now that countries like Germany are stepping up their spending. But the amount of available euro-denominated safe assets pales in comparison with that of U.S. capital markets.

Still, in the recent period of volatility, investors have found a number of places to take cover. The euro, Swiss franc and Japanese yen have been clear beneficiaries. Gold has rallied sharply, too.

“You don’t need to have the role of the dollar as a reserve asset go to zero,” said Ms. Mateos y Lago. “A multipolar system can totally work.”

Burden or Privilege?

When asked at Wednesday’s event, which was hosted by the Institute for International Finance, whether the dollar’s reserve currency status was a burden or a privilege, Mr. Bessent said: “I actually am not sure that anyone else wants it.”

But economists warn that Americans would be losing clear benefits if the government was too cavalier about the dollar’s shedding its special status.

The country’s exporters would reap rewards, as a weaker dollar would make their products more competitive. However, that advantage could come at the expense of reduced spending power for Americans abroad and higher borrowing costs at a time when the government has huge financing needs.

Despite the pain that Americans may have to bear, the global financial system would be far more “resilient” if other currencies shared the dollar’s global role over time, said Barry Eichengreen, an economist at the University of California, Berkeley. During times of stress, that would mean multiple sources of liquidity.

However, three months into Mr. Trump’s second term, Mr. Eichengreen warned that a “dire scenario is now on the table” — a sharp sell-off of dollar-denominated assets into cash.

“A chaotic rush out of the dollar would be a crisis,” he said. “All of a sudden, the world would not have the international liquidity that 21st-century globalization depends on.”