Indian Pharma Sector Braces for Impact: Contingency Plans Ready Amid US Tariffs

Indian pharmaceutical manufacturers are preparing for a two-pronged strategy to offset the impact of the recent tariffs of 25% that have been imposed on Indian exports by the United States President Donald Trump, which include drug exports.

According to analysts, this move can severely raise medicine costs in the American market.

What Do Analysts Say?

According to Girdhar Gyani, the Director General of the Association of Healthcare Providers (India), there is a concern over the fiscal burden the proposed US tariff would impose on both Indian exporters as well as American consumers.

At present, India is supplying affordable generics to nearly 47% of the US pharmaceutical market.

"If the United States enforces this 25 per cent tariff, the cost of drug delivery in the US will inevitably rise. Our estimates show that American drug prices could increase by 20 to 25 per cent annually -- a burden of nearly USD 6 to USD 7 billion. It's unclear whether the US healthcare system can absorb such an impact," an ANI report cited Gyani.

The Association of Healthcare Providers (India), which is a non-profit organisation, represents the majority of healthcare providers in India.

While there may be an initial blow to Indian manufacturers, Gyani said that industry players are already preparing contingency plans.

One such example is the fact that US and Mexico based facilities are ramping up their production and this would bypass the tariff restrictions.

According to Gyani, the goal is to increase the volume and price range of such drugs, thereby maintaining competitiveness even under the new tariff regime.

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