Cipla CEO Says US Drug Pricing Order Unlikely To Impact Indian Generics

Vohra stated that the directive appears to be primarily aimed at branded pharmaceutical products rather than generic medicines, which already have competitive pricing in the US market

Vohra stated that the directive appears to be primarily aimed at branded pharmaceutical products rather than generic medicines, which already have competitive pricing in the US market

Source : Freepik

Cipla Managing Director and Global CEO Umang Vohra on Tuesday downplayed concerns about the impact of a recent US executive order on Indian generic drugmakers. The order, signed by former US President Donald Trump on May 12, mandates pharmaceutical companies to reduce the prices of prescription drugs within 30 days or face regulatory changes that could tie US drug prices to those in other countries.

Vohra stated that the directive appears to be primarily aimed at branded pharmaceutical products rather than generic medicines, which already have competitive pricing in the US market. “What we understand is that this is largely targeted towards branded drugs...As of now, what we understand is that this is a voluntary measure that perhaps the companies will be taking,” Vohra said, as per a PTI report.

He noted that while the order mentions clauses like Most Favored Nation (MFN) pricing, the specifics of how the policy will be implemented remain unclear. “So as of now, from a generic perspective, I think generic (drug) prices in the US are already significantly comparable with the rest of the world, in some cases it is lower. So we don't believe that at least for now, based on what the promulgation says we think this is more (towards) branded sector...rather anything on the generic side,” he added.

Potentia Tariff On Pharma Imports

Addressing concerns around potential tariffs on pharmaceutical imports, Vohra reiterated that Cipla's operations in the US have remained unaffected. “And so we don't see the impact. In any case, we are in the generic sector. The purpose of what we do is to provide medicines to people who really need it from an affordability perspective. So as of now, we don't see any impact of tariffs on our business,” he said.

He acknowledged the evolving dynamics between the US and Indian governments, but maintained that no significant changes to the business environment for generics are expected. Even if tariffs are introduced, they are likely to be lower than those applied to other goods. We are closely monitoring developments, but do not foresee any major impact, Vohra said.

Currently, the US does not impose tariffs on Indian pharmaceutical imports, while India levies a 10 per cent duty on American drugs. In April, the US government exempted Indian pharma companies from reciprocal tariffs, recognising their crucial role in global healthcare.