The U.S. administration has announced a phased tariff roadmap to force domestic generic drug manufacturing. Following a zero-tariff grace period ending July 2028, import tariffs will jump to 100% in August 2028, and a staggering 200% by August 2029.
Building FDA-compliant plants takes years, making this two-year window incredibly tight. Because generics are high-volume but low-margin, absorbing these taxes is nearly impossible. Experts warn this could trigger U.S. drug shortages and price spikes.
India, supplying over 40% of U.S. generic prescriptions (around $10B annually), stands to lose the most. Unlike European makers of high-margin branded drugs, Indian manufacturers face severe margin disadvantages.
U.S. Revenue Exposure for Top Indian Pharma:
Gland Pharma: ~52.7%
Glenmark: ~46.5%
Dr. Reddy’s: ~45.9%
Aurobindo: ~45.3%
Biocon: ~43.7%
Lupin: 38.0%
Sun Pharma: 33.3%
Cipla: 13.0%
Torrent: ~10%
With massive financial exposure across injectables, oral solids, and respiratory drugs, India's pharma sector must rapidly rethink its supply chains and shift production to the U.S. or risk losing its biggest market.