New York— U.S. President Donald Trump has warned that the exemption for pharmaceuticals—a major Indian export—from his sweeping retaliatory tariffs will end soon.
“We’re going to be announcing very shortly a major tariff on pharmaceuticals,” Trump said Tuesday night, just before his new tariffs on most U.S. imports were set to take effect.
While Trump mentioned China during his remarks at a National Republican Congressional Committee dinner in Washington, he did not reference India, which sends 31.5 percent of its exports to the United States.
Most other Indian exports will be impacted by the 37 percent reciprocal tariffs he announced last Wednesday.
“This is breaking news, ladies and gentlemen,” Trump declared.
He predicted that once the pharmaceutical tariffs are implemented, drug companies “will leave China, they will leave other places, because they have to sell—and most of their product is sold here.”
“They’re going to be opening up their plants all over the place—in our country,” he added.
When Trump announced his reciprocal tariffs last week, he initially exempted pharmaceuticals, copper, semiconductors, lumber, bullion, energy, and certain minerals due to their critical importance to the U.S. economy.
The pharmaceutical reprieve was specifically aimed at keeping healthcare costs in check. Imported drugs, especially generic medications from India, play a significant role in containing costs within the U.S. healthcare system, one of the most expensive in the world.
Experts have warned that imposing tariffs on pharmaceuticals could drive up costs for American consumers.
“In the absence of a deal with India, we think Trump’s tariffs will mostly drive up drug prices for U.S. consumers,” ING Bank stated, noting India’s dominance in the generic drug market.
“The global supply chain for generic and biosimilar medicines is critically important for U.S. patients,” said John Murphy, president of the Association for Accessible Medicines, earlier this year.
“Generic manufacturers simply can’t absorb new costs,” he added. “Our manufacturers sell at an extremely low price—sometimes at a loss.”
India and the United States are currently working to finalize a Bilateral Trade Agreement, which could potentially soften the blow of new tariffs.
Indian External Affairs Minister S. Jaishankar and U.S. Secretary of State Marco Rubio recently agreed during a phone call on the “early conclusion” of such a deal.
According to IQVIA, a healthcare data and analytics company, four out of every ten prescriptions filled in the U.S. in 2022 came from Indian companies.
“Out of the top ten therapy areas by prescription volume, Indian companies supplied more than half of the prescriptions in five categories: hypertension, mental health, lipid regulators, nervous system disorders, and antiulcerants,” the company reported. (Source: IANS)
