Trump Imposes 100% Tariff on Imported Drugs; What It Means for India’s Pharma Industry

US PresidentDonald Trump announced on Friday that starting October 1, 2025, all branded and patented drugs imported into the United States will face a 100 percent tariff unless the companies build manufacturing plants in the country.

India, which supplies over half of the world’s vaccines, nearly 40 percent of generic medicines to the US, and about a quarter of medicines in the UK, could be hit hard. Indian drug exports reached a record USD 30 billion in FY25, thanks to strong growth earlier this year. In August 2025 alone, exports rose to USD 2.51 billion, up from USD 2.35 billion the previous year.

Major Indian companies such as Dr. Reddy’s, Aurobindo Pharma, Zydus Lifesciences, Sun Pharma, and Gland Pharma earn a significant portion of their revenue from the US, making them particularly vulnerable to the new tariff. Trump clarified that companies already building plants in the US will not face the tariff.

In addition to drugs, the Trump administration also announced heavy tariffs on household items, including kitchen cabinets, bathroom vanities, upholstered furniture, and trucks.

The new rule could have wide-ranging effects. Indian companies may see their revenue from the US drop, while smaller firms may struggle to compete. Prices for medicines in the US could go up if companies pass on the added cost, and there may be delays or disruptions in the global supply of vaccines and generic drugs.

On the other hand, some Indian companies might speed up plans to build factories in the US to avoid tariffs, which the US President exactly wants. Over time, India may also try to expand into new markets and strengthen its own production at home.

India’s pharmaceutical industry, known as the “Pharmacy of the World,” is the third largest in the world by volume and continues to grow. Supported by government programs, the sector is preparing for long-term growth and hopes to reach USD 130 billion by 2030 and USD 450 billion by 2047.

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