India’s pharmaceutical sector has come under the spotlight after former US President Donald Trump announced a steep 100 per cent tariff on branded and patented pharmaceutical imports. The announcement was made on Thursday via Trump’s Truth Social account, and the new tariffs are set to take effect from October 1, 2025.
Trump clarified that branded and patented medicines would only be exempt from the tariffs if the exporting company is actively building a pharmaceutical manufacturing plant in the United States. He defined “IS BUILDING” as a project where construction has already begun or is under way. While this bold move has raised questions over how it will be implemented, it has already triggered ripples in India’s pharma industry, which is heavily dependent on exports to the US.
Donald Trump’s 100% tariffs raise red flags for Indian pharma exports
The United States remains one of the most significant markets for India’s drug manufacturers. India, known as the “Pharmacy of the World,” exported pharmaceutical products worth $30 billion in FY25, aided by a 31 per cent year-on-year surge in March.
Government data shows that India’s drug and pharmaceutical exports rose 6.94 per cent between August 2024 and August 2025, increasing from $2.35 billion to $2.51 billion. In just the first half of 2025, pharmaceutical shipments valued at $3.7 billion (₹32,505 crore) were sent overseas. Trump’s tariffs now pose a direct challenge to this growth trajectory.
Indian pharma giants brace for impact of Donald Trump’s 100% tariffs
Although the tariffs will not apply to generic drugs — which form the backbone of India’s exports to the US — leading Indian pharmaceutical firms still face looming challenges. Companies such as Sun Pharma, Dr. Reddy’s, Cipla, Zydus Lifesciences, Gland Pharma, and Aurobindo Pharma derive between 30 to 50 per cent of their revenues from the American market.
While generics may remain unaffected, the pricing pressures, compliance costs, and uncertainty around patent-linked exports have already rattled investor confidence.
Stock market reacts sharply to Donald Trump’s pharma tariff announcement
The impact of Trump’s 100 per cent tariffs was visible on Friday as Indian stock indices slipped in early trade. The Nifty Pharma index plunged 2.42 per cent to an intraday low of 21,445.50.
Shares of Sun Pharma dropped 4.87 per cent to a new 52-week low at ₹1,548, while Gland Pharma slumped 4.70 per cent to ₹1,880. Biocon declined 3.68 per cent to ₹342.85. Other pharmaceutical majors, including Laurus Labs, Ipca Labs, Divi’s Laboratories, Torrent Pharma, Abbott India, Ajanta Pharma, Alkem Labs, and Glenmark, also saw losses ranging between 0.8 to 3.2 per cent.
Uncertainty clouds India-US pharma trade amid Trump’s tariff policy
India ranks third globally by volume and 14th in terms of value when it comes to pharmaceutical production. Its long-standing position as a leading medicine supplier to the US faces uncertainty under Trump’s 100 per cent tariff policy.
While generics remain safe for now, India’s branded exports and patented drug categories may suffer unless companies choose to invest in US-based manufacturing facilities. With less than a week to go before the policy takes effect, Indian pharma firms are closely monitoring developments that could redefine their largest export market.
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