Trump plans high generic-drug tariffs in 2028 to spur U.S. production

President Donald Trump said generic drugs imported into the United States will face zero tariffs for two years starting Aug. 1, followed by a 100 percent tax in August 2028, rising to 200 percent a year later.

Trump said on social media that the phased program aims to force generic drug manufacturers to move production offshore. to post On Tuesday, he announced that this increase was a “penalty” for companies that did not establish plants and facilities in the United States during the grace period.

Trump said tariffs on patented and brand-name drugs will not change. President imposes 100% tax on patented pharmaceutical products and ingredients Pursuant to Section 232 On April 2, generic medicines, biosimilars and related ingredients will be exempt. Larger drug manufacturers were given 120 days before the 100 percent tariff rate took effect, and smaller drug manufacturers that depend on contract manufacturers were given 180 days before the rate took effect.

More than a dozen major drugmakers, including Eli Lilly, Pfizer and Novo Nordisk, have struck deals with Trump to lower prices on new and existing drugs. These deals are part of the president’s “most favored nation” policy, which ties U.S. drug prices to cheaper prices abroad and exempts companies from tariffs for three years.

Trump used tariff threats and most-favored-nation pricing policy to force drug manufacturers to stop charging Americans more than patients in other high-income countries.

Risks are high for India due to supply from pharmaceutical companies in the country almost 50% of all generic drugs It is consumed in America. The USA has an account of approx. one third of india Pharmaceutical exports, mostly cheaper versions of popular drugs, annually. Chinese companies dominate upstream supply of active pharmaceutical ingredientssuch as amoxicillin and heparin.