Last Tuesday, Trump announced 100% tariffs on generic medicines imported into the US. By Wednesday, Indian pharma stocks were already falling even though the tariff doesn&#x27;t take effect for two years. Trump wants import companies to reshore their manufacturing to the US so that the country can secure life-saving medication in the event of global supply chain disruptions. India supplies nearly 50% of all generic medicines consumed in America — birth control, antidepressants, hypertension treatments. The companies most exposed say shifting manufacturing to the US in two years isn&#x27;t realistic. Building a viable generics ecosystem there takes at least five. But someone has to absorb the cost. And Indian companies have already said that moving is not a realistic plan — for now. Which means the ones picking up the bill are not the ones Trump thinks. Tune in. Take the Daybreak listener survey here. Daybreak is produced from the newsroom of The Ken, India’s first subscriber-only business news platform. Subscribe for more exclusive, deeply-reported, and analytical business stories.

Why Indian pharma isn't scared of a 100% tariff (yet)

Daybreak

Last week, on Tuesday, US President Donald Trump made an announcement. He said that tariffs on genetic medications imported into the US would eventually hit 100%. And by Wednesday, Indian pharma stocks were already reacting. Bloomberg reported that the NSC Nifty Pharma index fell by more than 1%. Sun Pharma, one of the sector giants that sells household names like

Voloni, the pain relief spray or gel, fell by nearly 1%. Even Cipla, which makes the other popular pain medication Omnigel, and cold meds like Chest and Gold saw its own shares fall by almost 2%. But here's the part that might surprise you. This tariff doesn't actually take effect for two more years. So why is the market panicking already? Well, part of the reason is this.

CNBC reports that these tariffs are expected to hit Indian pharma companies especially hard, because they supply nearly 50% of all generic medicines consumed in America. Not just that. According to market estimates reported by Outlook Business, India exports close to $8 to $9 billion worth of pharmaceutical products to the US every year, and the vast majority of it is

generics. Now, the idea behind the tariff, as Trump wrote in his Truth Social post, was to reshore generic pharmaceutical production into America. So, the domestic supplies for life-saving medications could be secured within the country in the case of any global supply chain disruptions. Now, this new announcement is part of a larger push from the US government to bolster American national

security and public health. In April this year, Trump had already announced a 100% tariff on patented pharma ingredients. In the fact sheet released by the White House at the time, generics had been exempted.

Why Indian pharma isn't scared of a 100% tariff (yet)

Read the full transcript

The candid version is on a podcast,
not the earnings call.

Why Indian pharma isn't scared of a 100% tariff (yet)

Read the full transcript

The candid version is on a podcast, not the earnings call.

The candid version is on a podcast,
not the earnings call.