Why Trump's 100% Pharma Tariffs May Not Impact Indian Drugmakers Much

US President Donald Trump has said his administration will impose 100 per cent import tariffs on branded or patented pharmaceutical drugs from October 1, unless the pharma companies have or are building their manufacturing units in America. But the move may not have any major impact on the Indian pharmaceutical sector.

The US market accounts for slightly more than a third of India's pharmaceutical exports, which comprise mainly cheaper generic versions of popular drugs. Indian pharma exports to the US rose 20 per cent to about $10.5 billion in fiscal 2025.

While the majority of exports are generic drugs, some big Indian pharma companies, such as Dr Reddy's, Sun Pharma, and Cipla, also export patented medicines to the US.

Impact On Indian Pharma

The latest blitz of US tariffs seems to mainly target branded and patented drugs, where multinational companies like Pfizer Inc. and Novo Nordisk Inc. dominate. Major Indian players like Cipla Ltd., Dr Reddy's Laboratories Ltd., and Lupin Ltd., among others, already have manufacturing facilities in the US, according to a report by NDTV Profit.

Another major player, Bengaluru-based Biocon, through its wholly owned subsidiary Biocon Generics Inc., has also commissioned its US manufacturing facility earlier this month in Cranbury, New Jersey. Hence, Biocon is also likely to face no impact from the 100 per cent tariff.

Sun Pharma remains a major exporter that may have some impact until it announces its US capex plans, the NDTV profit report said. Any official statement from the drugmaker is awaited.

Meanwhile, there is still uncertainty whether complex generics and biosimilars will come under the tariff embargo in the future, ICICI Securities told news agency Reuters.

But Namit Joshi, Chairman of the Pharmaceuticals Export Promotion Council of India, said Trump's decision will not have much of an impact on Indian generic exports.

“We don't export any patented and branded drugs to the US. Right now, it is not for generics. We don't foresee much of an impact of this notification on the Indian generic pharmaceutical industry,” he told PTI.

Pharma Shares Slide After Trump Tariff

Indian benchmarks fell in a broad-based sell-off on Friday, led by pharma shares after Trump's announcement. The Nifty 50 and the BSE Sensex shed 0.47 per cent each to 24,774.3 and 80,775.23 points, respectively, as of 10:21 a.m. IST. The indexes are on course for a sixth consecutive session of losses.

Fifteen of the 16 major sectors traded lower on the day. The pharma index was the biggest loser, dropping 2.4 per cent on uncertainty over the impact of Trump's tariffs on the sector.

Sun Pharmaceutical Industries declined 2 per cent, and was the biggest Nifty 50 loser. Natco Pharma fell 3.4 per cent, losing the most on the pharma index.