Trump likely to announce pharma tariffs as high as 200% this month

US President Donald Trump on Wednesday (IST) said he is likely to announce tariffs on pharmaceuticals by the end of this month, which could go as high as 200 per cent. The new tariffs would be part of a broader “reciprocal” trade framework scheduled for implementation on August 1, Bloomberg reported.

Speaking to reporters after returning from Pittsburgh, Trump said, “Probably at the end of the month, and we’re going to start off with a low tariff and give the pharmaceutical companies a year or so to build, and then we’re going to make it a very high tariff.”

He also suggested that semiconductor tariffs could follow a similar timeline. "It’s less complicated," he added, without elaborating on the specifics.

Earlier this month, in a cabinet meeting, Trump had proposed a 50 per cent tariff on copper and hinted that pharmaceutical tariffs could climb to 200 per cent after a grace period to allow companies to relocate manufacturing to the US.

Trump imposes reciprocal tariffs

In April, Trump announced sweeping reciprocal tariffs on more than 100 countries, aiming to incentivise companies to bring manufacturing back to the US. Until recently, pharmaceutical imports had largely been spared from such measures due to their critical nature. But in April, Trump warned of a 25 per cent levy on pharma imports, asserting that the move would reduce US dependence on foreign suppliers such as India and China.

During the NRCC gala that month, he reiterated plans for significant pharma tariffs, saying it would encourage reshoring of drug production.

Potential impact on India’s pharma sector

The US is India's largest pharmaceutical export market, accounting for 36.6 per cent of its drug exports worth $9.8 billion between April 2024 and February 2025. According to a Reuters report citing Pharmexcil data, India’s pharma exports to the US rose 16 per cent in the last fiscal year.

A 200 per cent tariff, if implemented, could have severe repercussions for Indian pharmaceutical companies, many of which derive a large share of revenue from the US market.

Indian firms likely to be hit

Biocon earned 44 per cent of its revenue from the US in FY24.

Lupin generated 37 per cent of its income from the US.

Laurus Labs derived 17 per cent of its earnings from North America.

Sun Pharma, India’s largest drugmaker, drew 32 per cent of its total revenue from US sales.

Other major Indian pharmaceutical companies with significant US business exposure include Dr Reddy’s, Aurobindo Pharma, Zydus Lifesciences, and Gland Pharma.

A CNBC report noted that following Trump’s earlier remarks, Indian pharma industry stakeholders have begun exploring market diversification strategies in anticipation of trade disruptions.