Trump Imposes 100% Tariffs On Branded, Patented Drugs From Oct 1: What It Means For India

Trump announced 100 percent tariffs on pharmaceutical products. He clarified that the companies that have already begun building manufacturing plants in the US will be exempted from the new tariffs.

US President Donald Trump imposed a 100 percent tariff on any branded or patented pharmaceutical product from October 1.

Source : ANI

US President Donald Trump on Thursday announced a 100 percent tariff on imports of branded or patented pharmaceutical products from October 1, a move likely to impact key Indian drugmakers. 

In a post on Truth Social, President Trump wrote, "Starting October 1st, 2025, we will be imposing a 100% Tariff on any branded or patented Pharmaceutical Product, unless a Company IS BUILDING their Pharmaceutical Manufacturing Plant in America. 'IS BUILDING' will be defined as 'breaking ground' and/or 'under construction."

Trump, however, clarified that the companies that have already begun building manufacturing plants in the US will be exempted from the new tariffs. "There will, therefore, be no Tariff on these Pharmaceutical Products if construction has started. Thank you for your attention to this matter!" the post read.

Earlier on Thursday, Trump also imposed a 50 percent Tariff on all Kitchen Cabinets, Bathroom Vanities, and associated products, starting October 1. US will also charge a 30 percent tariff on upholstered furniture.

"The reason for this is the large-scale 'FLOODING' of these products into the United States by other outside Countries," Trump said. "It is a very unfair practice, but we must protect, for National Security and other reasons, our Manufacturing process."

How India Could Be Affected

The US is one of the largest drug markets for Indian drugmakers, specifically in the affordable and generic segment. Following Trump's announcement, the focus is now shifting to Indian Pharma companies, including Aurobindo Pharma Ltd., Gland Pharma Ltd., Lupin Ltd., and Cipla Ltd. 

India’s pharmaceutical industry remains a global leader, meeting over half of worldwide vaccine demand, nearly 40 percent of US generics, and about a quarter of medicines consumed in the UK exports hit a record USD 30 billion in FY25, driven by a 31 percent year-on-year surge in March.

According to a government release, pharma exports rose 6.94 percent year-on-year in August, from USD 2.35 billion in 2024 to USD 2.51 billion in 2025. In FY24, outbound shipments were worth USD 27.9 billion, with the US alone accounting for 31 percent (USD 8.7 billion or Rs 77,231 crore). During the first half of 2025, India exported USD 3.7 billion (Rs 32,505 crore) in pharmaceutical products.

Top players including Dr. Reddy’s, Aurobindo Pharma, Zydus Lifesciences, Sun Pharma, and Gland Pharma derive 30–50 percent of their revenues from the American market.

According to another official statement, India ranks third globally by volume and 14th by value in drug production. The sector, already a key supplier of vaccines and generics, is projected to expand to USD 130 billion by 2030 and reach a USD 450 billion market by 2047.

A report by analytics firm IQVIA stated that Indian pharmaceutical companies supply a substantial proportion of drugs to the US, with four out of ten of all prescriptions being supplied by Indian companies. "Indian companies supplied 47% of all generic prescriptions filed in the U.S. and 15% of the volume of biosimilars," it said.

A 100 percent tariff would double the cost of Indian branded or patented drugs in the US market (assuming no exemptions), making them far less price-competitive. This could reduce revenue, shrink margins, and lead some of the companies to pull back from certain product lines.

After the earlier tariff threats, the Nifty Pharma Index and shares of companies like Sun Pharma, Dr. Reddy’s, Cipla, and Aurobindo reacted negatively. This trend could continue amid mounting uncertainty ahead of the the October deadline.

In August, Trump had warned that tariffs on Pharma imports could reach up to 250%. He had said that he would initially begin by imposing a "small tariff", and gradually raise it to 150 percent and then 250 percent.