Trump Slaps 100% Pharma Tariffs: What It Means For Indian Companies

To be sure, the US tariffs mainly target branded and patented drugs, where multinational companies like Pfizer Inc. and Novo Nordisk Inc. dominate.

It is yet unclear whether complex generics and specialty drugs from India could also face scrutiny.

Sun Pharmaceutical Industries Ltd. and Biocon Ltd. are key branded players in the US.

Bengaluru-based Biocon, through its wholly owned subsidiary Biocon Generics Inc., commissioned its US manufacturing facility earlier this month in Cranbury, New Jersey. Biocon acquired the Oral Solid Dosage (OSD) facility from Eywa Pharma Inc. in 2023 and has since invested over $30 million to establish a state-of-the-art plant with an annual production capacity of two billion tablets.

Hence, Biocon will likely face no impact from the 100% tariff.

Sun Pharma may have some impact until it announces its US capex plans. It exports specialty drugs like ILUMYA, CEQUA, WINLEVI and ODOMZO. This category contributes 19% to overall revenue.

Other large Indian pharma companies like Cipla Ltd., Dr Reddy's Laboratories Ltd., and Lupin Ltd. already have manufacturing facilities in the US.

While the current 100% tariff specifically targets branded or patented drugs, there's a broader context of ongoing US-India trade tensions and previous discussions regarding tariffs on Indian imports. Pharmaceuticals have sometimes been exempt but remain under scrutiny, with earlier proposals hinting at potential tariffs on pharmaceuticals reaching up to 250%.