US Announces 100% Tariff on Imported Patent Drugs, India May Be Impacted

The United States has announced tariffs of up to 100 percent on imported patent medicines. President Donald Trump cited national security concerns and excessive dependence on foreign supply chains as the reason. The announcement stated that medicines and their components are being imported in such quantities and circumstances that they could pose a threat to US national security.

The tariffs will apply to patent drugs and active pharmaceutical ingredients (APIs) that are critical for civilian healthcare and military preparedness. Companies that commit to shifting production to the United States will initially face a reduced tariff of 20 percent, which will rise to 100 percent after four years. Imports from the European Union, Japan, South Korea, and Switzerland will attract a lower tariff of around 15 percent.

On a positive note, generic drugs and biosimilars are currently exempt from these tariffs. Specialty categories such as orphan drugs, nuclear medicines, and gene therapies are also excluded. The tariffs will be rolled out in a phased manner from July 31, 2026.

This decision is expected to have a sweeping impact on global pharmaceutical trade. India and China are the world’s largest producers of generic drugs and APIs, supplying a significant share of the US market. While generics are currently exempt, any future expansion of tariffs could have far-reaching consequences for global drug supply chains and pricing.