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Trump Slaps 100% Tariff on Patented Drugs; US Families Face Rising Healthcare Costs
The largest export of medicines to the US comes from Gujarat and Telangana. These two states together export medicines worth Rs 1.06 lakh crore. Following this, over 10,000 MSME companies are producing generic medicines in 30 Indian states, including Maharashtra, Madhya Pradesh, and Tamil Nadu.
American families will face significant costs due to US President Donald Trump' s announcement of a 100% import duty on branded and patented medicines. Notably, 80% of medicines exported from India to the US are generic, a detail Trump did not mention.
Most major pharmaceutical companies, including Dr. Reddy' s, Lupin, Aurobindo, Sun Pharma, Cipla, and Zydus, have factories in the US, which Trump has exempted from this tariff. A senior official from the Union Ministry of Chemicals and Fertilizers stated, "Donald Trump is aware that India supplies medicines worldwide, including to the US, at the lowest prices." Increasing tariffs on generics would directly harm consumers in the US by raising medicine prices. Data shows India exports medicines worth ₹ 2. 70 lakh crore annually, with ₹ 93, 000 crore to the US; of these, ₹ 65, 000 crore are generics, which Trump has exempted. In the first half of this year, India exported ₹ 3, 000 crore worth of medicines to the US.
Gujarat and Telangana are the leading export states, together sending medicines worth ₹ 1. 06 lakh crore. Over 10, 10,000 MSME companies across 30 Indian states, including Maharashtra, Madhya Pradesh, and Tamil Nadu, produce generics.
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The official added, "Trump is using tariffs to stay in the headlines, targeting India daily, even though India' s pharma sector isn' t solely dependent on the US." His decision raises questions about US pharmaceutical policy rather than causing a major blow to India' s industry.
Trump has discussed tariffs globally but hasn' t shared data on US gains from Indian pharmaceuticals. A report from India' s Ministry of Chemicals and Fertilizers states that between 2013 and 2022, US pharmaceutical exports from India saved $ 1. 3 trillion (₹ 115. 3 lakh crore), with significant savings in 2022.
Industry leader Niranjan Hiranandani called these tariffs a positive opportunity for India, stating, "This will encourage rapid expansion of manufacturing and help India become self- reliant."
After the announcement, shares of major pharma companies fell sharply- up to 9. 40% for Sun Pharma, Dr. Reddy' s, Lupin, and Cipla. The Nifty Pharma Index also declined, along with stocks from Hong Kong, Australia, and the EU.
According to the US Census Bureau, the US imported about $233 billion worth of pharmaceuticals in 2024. The move could cause drug prices to double, potentially increasing healthcare costs for Americans, including Medicare and Medicaid expenses.
