Delhi: US President Donald Trump announced 100% tariffs on branded and patented drugs, effective October 1, 2025, while exempting companies establishing manufacturing plants in America.
Trump clarified that companies currently constructing pharmaceutical facilities in the United States would avoid the new tariffs. “If construction has started, then there will be no tax on those medicines,” Trump stated during his announcement.
The pharmaceutical tariffs follow Trump’s earlier imposition of 50% tariffs on India, which took effect on August 27. Those tariffs increased export costs for Indian textiles, gems and jewellery, furniture, and seafood, though pharmaceuticals remained exempt at that time.
Trump branded drug tariffs could expand to generic medications
Market experts have predicted a limited immediate impact on India’s generic drug exports. However, he warned that Trump’s next target might include generic medications, potentially creating emotional volatility in pharmaceutical stocks.
India dominates global generic drug exports to America, shipping approximately $8.73 billion worth of medicines in 2024. This figure represented roughly 31% of India’s total pharmaceutical exports.
American doctors prescribe Indian-manufactured drugs in nearly four out of every ten prescriptions written. According to industry reports, America’s healthcare system saved $219 billion in 2022, with total savings reaching $1.3 trillion between 2013 and 2022.
Major Indian pharmaceutical companies, including Dr Reddy’s, Sun Pharma, and Lupin, manufacture both generic and some patented medicines for the US market. The new Trump-branded drug tariffs policy could force these companies to reconsider their manufacturing strategies.
