The BRICS TimesIndian stock markets slipped sharply on Friday as pharma shares tumbled following Trump’s bold tariff announcement.
US President Donald Trump has declared that his government will slap 100 per cent import duties on branded and patented pharmaceutical medicines from October 1. The tariffs will apply unless companies have set up or are building manufacturing plants in the US. Despite the strong move, analysts believe it may not severely hurt Indian pharmaceutical companies.
The American market makes up a little over one-third of India’s pharma exports. Most of these exports are affordable generic alternatives to popular medicines. India’s pharma exports to the US jumped 20 per cent in FY25, touching nearly $10.5 billion.
Although the bulk of shipments are generics, some leading Indian names, including Dr Reddy’s, Sun Pharma, and Cipla, also supply patented medicines to the US.
Impact on Indian Pharma
The newly announced US tariffs are mainly aimed at branded and patented medicines, where global giants like Pfizer Inc. and Novo Nordisk Inc. dominate the market. Major Indian companies such as Cipla Ltd., Dr Reddy’s Laboratories Ltd., and Lupin Ltd. already operate manufacturing units in America, a report noted.
Another big name, Biocon from Bengaluru, is also safe from the tariff hit. Its subsidiary Biocon Generics Inc. launched a US facility earlier this month in Cranbury, New Jersey. This ensures no major disruption for Biocon under Trump’s new rules.
Sun Pharma could see some effect until it lays out its capital expenditure strategy for the US, the report mentioned. The company has not yet issued an official statement.
However, there is still some uncertainty regarding whether advanced generics and biosimilars might face tariffs later, according to ICICI Securities.
Namit Joshi, Chairman of the Pharmaceuticals Export Promotion Council of India, said the move is unlikely to cause any disruption in generic exports.
“We don’t export any patented and branded drugs to the US. Right now, it is not for generics. We don’t foresee much of an impact of this notification on the Indian generic pharmaceutical industry,” he told PTI.
Pharma Shares Slide After Trump Tariff
Indian stock markets reacted quickly to the announcement. On Friday, benchmarks dropped in a broad sell-off led by pharma shares. Both the Nifty 50 and BSE Sensex slipped 0.47 per cent each, trading at 24,774.3 and 80,775.23 points as of 10:21 a.m. IST. The indexes are now heading for their sixth straight session of losses.
Fifteen of the 16 major sectoral indices ended lower on the day. Pharma stocks saw the steepest fall, dropping 2.4 per cent as traders assessed the tariff impact.
Sun Pharmaceutical Industries was the top loser on the Nifty 50, shedding 2 per cent. Natco Pharma declined 3.4 per cent, marking the sharpest fall in the pharma index.
