US tariff plan on generic drugs a wake-up call for Indian pharma, say experts

Industry leaders and healthcare experts said the proposed US tariffs on imported generic medicines should push India's pharmaceutical sector to diversify export markets, boost innovation and strengthen resilient supply chains while ensuring affordable medicines remain accessible to patients worldwide

New Delhi: India’s pharmaceutical industry should treat the proposed US tariffs on imported generic medicines as a wake-up call to reduce dependence on a single export market, diversify globally and accelerate innovation while ensuring uninterrupted access to affordable medicines, industry leaders and healthcare experts said.

US President Donald Trump has announced a phased tariff framework under which imported generic medicines will continue to attract zero tariffs until August 1, 2028, before facing a 100 per cent tariff for one year and a 200 per cent tariff from August 1, 2029.

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The proposal, aimed at encouraging drug manufacturing in the US, has triggered a debate within India’s pharmaceutical sector over its long-term implications. Nikhil K Masurkar, CEO, ENTOD Pharmaceuticals, described the proposed tariffs as an opportunity for long-term strategic transformation, rather than merely a trade challenge.

“The finer details of the proposed US tariffs on generic drugs are still unclear, but one thing is certain Indian pharma can no longer afford to be overly dependent on a single market,” he said.

This is the right time to diversify, strengthen the domestic innovation ecosystem and position India as the healthcare leader of the Global South, Masurkar said.

“India has built an enviable reputation as the pharmacy of the world. The next chapter should be about becoming the innovation partner and healthcare leader for emerging economies across the Global South,” he said.

Dr Shefali Mazumdar, surgeon and eye bank in-charge at Sarojini Naidu Medical College, Agra, said discussions on trade policies should ultimately remain centred on patients.

“From a clinician’s perspective, the biggest concern is continuity of treatment. Generic medicines allow millions of patients to remain compliant with long-term therapies for chronic diseases, because they are affordable. “If prices rise sharply due to trade barriers, many patients may delay refilling prescriptions, reduce adherence or discontinue treatment altogether,” she said.

“Even in developed healthcare systems, affordability directly influences health outcomes. Policies that inadvertently increase medicine costs can lead to higher rates of disease complications, avoidable hospitalisations and an overall increase in healthcare expenditure,” she added.

Vivek Padgaonkar, founder, Paddy Advisory Services LLP, and former director (projects and policy), Organisation of Pharmaceutical Producers of India (OPPI), stressed that strengthening domestic pharmaceutical manufacturing should complement rather than replace globally integrated supply chains.

“The pharmaceutical industry has evolved through strong international collaboration in research, manufacturing and supply. Policies that significantly restrict cross-border movement of medicines could create inefficiencies, increase costs and reduce the resilience of global healthcare systems,” he said.

“Any policy intervention should strike a balance between strengthening domestic manufacturing and preserving uninterrupted patient access to safe, effective and affordable medicines. Collaborative policy frameworks are more likely to deliver sustainable healthcare outcomes than measures that create trade barriers,” Padgaonkar said.

The experts also noted that while the proposal may prompt companies to reassess manufacturing strategies over the long term, relocating production facilities would require regulatory approvals, technology transfer, workforce development and substantial investments, making it unlikely to offer an immediate solution.

They emphasised that resilient global supply chains remain critical to ensuring uninterrupted access to quality medicines as healthcare systems worldwide continue to grapple with rising chronic disease burden and ageing populations.