Phased tariffs aim to shift generic drug production to the U.S., starting with a 100% levy in 2028 and doubling a year later.
Former President Donald Trump announced plans to impose a 100% tariff on imported generic drugs beginning August 2028, rising to 200% in 2029. The policy follows a two-year exemption starting August 1, intended to incentivize drugmakers to relocate production to the U.S. during the grace period.
Trump previously imposed a 100% tariff on patented pharmaceuticals in April, exempting generics and biosimilars. Major drugmakers, including Eli Lilly and Pfizer, secured three-year tariff exemptions under a “most favored nation” pricing agreement, tying U.S. drug costs to lower prices abroad.
The move targets India’s pharmaceutical sector, a key supplier of generic drugs to the U.S. No immediate market reaction was reported, though the policy could disrupt supply chains and increase costs for U.S. consumers.