Key facts
- President Trump announced plans to impose a 100 percent tariff on generic drugs starting August 2028, potentially increasing to 200 percent in 2029.
- The European Commission expects European generic medicines to be exempt from these tariffs due to a 2025 trade deal.
- The 2025 EU-U.S. trade deal committed the U.S. to a zero percent most-favored-nation tariff rate for EU generic pharmaceuticals.
- The EU stated that innovative drugs remain subject to a 15 percent tariff.
- The tariffs could impact India's pharmaceutical exports, which represent a significant portion of its total pharma exports to the U.S.
President Donald Trump announced plans to impose a 100 percent tariff on generic drugs starting in August 2028, with the rate potentially increasing to 200 percent in 2029. This move is part of an effort to encourage pharmaceutical production within the United States.
However, the European Commission has stated that it expects European generic medicines to be exempt from these tariffs. This expectation is based on a transatlantic trade deal struck in 2025, which reportedly committed the U.S. to a zero percent most-favored-nation tariff rate for generic pharmaceuticals from the EU. The EU noted that its innovative drugs would continue to face a 15 percent tariff.
The potential tariffs have raised concerns about impacts on pharmaceutical exports, particularly from India, which is a major supplier of generic drugs to the U.S. The EU generics lobby, Medicines for Europe, warned that the measures could lead to significant medicine shortages in the United States, emphasizing that off-patent drugs from Europe should remain tariff-exempt under the agreement.
Swiss generics manufacturer Sandoz indicated it was too early to fully assess the implications, pending further details on implementation. The U.S. administration has previously engaged in discussions with other countries, such as Germany and France, regarding their drug pricing policies.