Our Bureau
Washington, DC
United States President Donald Trump on Friday announced that his administration will impose a 100 per cent tariff on branded and patented pharmaceutical products beginning October 1, 2025, unless the manufacturing companies are building production facilities in the United States.
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.'”
Clarifying the scope of the measure, Trump added that companies that have already begun construction of plants in the US will be exempt from the new tariff. “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.
The Indian pharmaceutical sector supplies over 50 per cent of global demand for various vaccines, 40 per cent of generic demand in the US and 25 per cent of all medicines in the UK. India’s annual drug and pharmaceutical exports touched a record USD 30 billion in FY25 bolstered by a 31 per cent year-on-year surge in March.
According to a government release, drug and pharmaceutical exports increased by 6.94 per cent from USD 2.35 billion in August 2024 to USD 2.51 billion in August 2025 alone.
In FY24, India’s pharmaceutical exports stood at USD 27.9 billion, of which 31 per cent, about USD 8.7 billion (Rs. 77,231 crore), were directed to the US, according to the Pharmaceuticals Export Promotion Council of India (Pharmexcil). In the first half of 2025 alone, pharmaceutical shipments worth USD 3.7 billion (approximately Rs. 32,505 crore) were sent overseas.
Leading companies such as Dr. Reddy’s, Aurobindo Pharma, Zydus Lifesciences, Sun Pharma and Gland Pharma derive between 30-50 per cent of their overall revenues from the American market.
Meanwhile, the Sensex and Nifty in India opened in red on Friday as the Nifty 50 extended its losing streak, slipping below key levels for the fifth consecutive session. The index has already given up more than half of the 1,000-point rally it had witnessed since the August 29 lows.
The Nifty Pharma index dropped sharply by 2.42 per cent, touching an intraday low of 21,445.50. Sun Pharma slipped 4.87 per cent to a new 52-week low of Rs. 1,548, while Gland Pharma fell 4.70 per cent to Rs. 1,880. Biocon was down 3.68 per cent at Rs. 342.85. Other leading pharmaceutical companies, including Laurus Labs, Ipca Labs, Divis, Zydus Life, Alkem Labs, Cipla, Ajanta Pharma, Dr Reddy’s, Torrent Pharma, Abbott India, and Glenmark, also ended lower in the range of 0.8 to 3.2 per cent.
This comes on top of the tariff rates for dozens of countries which were introduced in August, after delays to allow for trade talks. They include: 50 per cent tariffs on Indian goods, including a 25 per cent penalty for trade with Russia; 50 per cent tariffs on Brazilian goods; 30 per cent tariffs on South African goods; 20 per cent tariffs on Vietnamese goods; 15 per cent tariffs on Japanese goods; and 15 per cent tariffs on South Korean goods.
