In an aggressive move that could reshape the global pharmaceutical supply chain, US President Donald Trump on Thursday declared a 100% tariff on all imported branded or patented medicines effective October 1, 2025.
The announcement, shared via Truth Social, signals America’s intent to pressure global drug firms to shift manufacturing stateside.
While the US typically relies on overseas pharmaceuticals, with India a leading supplier, the new measure leaves industry players and health officials scrambling to assess the magnitude of disruption.
Decoding Trump’s 100% tariffs on pharma sector
Detailing the move, President Trump underscored the tariff’s aim: to nudge multinational drug companies towards building manufacturing plants in the US.
His post made it clear that there are no exemptions unless ground is broken or construction is underway on American soil.
“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,” Trump wrote.
The announcement dovetails with similar protectionist measures, such as a 50% tariff on kitchen cabinets and 25% on heavy trucks, driven by what Trump calls “national security” concerns and a desire to insulate US industries from “flooding” by foreign competitors.
The pharmaceutical shockwave was instant: shares in Asian and European drugmakers slid in overnight trading as importers raced to forecast higher retail drug costs.
Pharma stocks in India and China, as well as major US suppliers, tumbled on the news. The administration’s message is blunt: Companies must invest in domestic production or risk losing access to the lucrative American market.
Analysts note Trump’s timing: US pharma giants have recently pledged billions in local expansion, spurred by the threat of these tariffs.
Historically, imported drugs faced little to no duty, a shift that could spur inflation, cause supply chain headaches, and provoke countermeasures from trading partners.
Countries in the crosshairs
India stands directly in the firing line of Trump’s policy, with deep economic stakes. Industry names like Sun Pharma, Dr Reddy’s, Lupin, and Aurobindo have come to rely heavily on US demand for affordable medicines.
Experts at SBI Research estimate 40% of India’s pharma exports go to the US; leading firms may derive up to 50% of total revenue from American buyers.
Even though the immediate focus is branded and patented drugs, uncertainty now hangs over the future of complex generics and specialty therapies, segments where India’s footprint is growing.
But the pain isn’t just local. Shares of drugmakers from China, Israel, Switzerland, and across Europe have dropped, with the risk of supply chain disruption and price spikes in the US noted by sector watchers.
Analysts warn that the tariffs could backfire: raising prices for American consumers, causing medicine shortages, and forcing hard choices in global health policy.
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