Indian Pharma Warns US Tariffs Could Raise Drug Costs, Cause Shortages

The Indian pharmaceutical sector has expressed concerns regarding the possible imposition of US tariffs on pharmaceutical exports, cautioning that this action might result in increased medication prices and possible shortages for consumers in the United States. Industry experts assert that Indian generics offer crucial cost reductions to the US healthcare system, contending that tariffs would eventually be passed on to consumers.

India's pharmaceutical exports to the United States exceed $9 billion, almost ten times the value of US pharmaceutical imports from India, which are around $800 million. According to Umang Vohra, global CEO of Cipla, the third-largest Indian drug maker, tariffs would have limited impact on US-India pharma trade dynamics. “Most lifesaving drugs imported into India from the US already attract zero tariffs, and any additional tariff waivers would have minimal revenue impact,” he stated.

Vohra also highlighted the vital importance of Indian generics in reducing healthcare expenses in the US, referencing a study conducted by IQVIA, a worldwide consulting company. The report indicated that Indian pharmaceuticals contributed to $219 billion in savings for the US healthcare system in 2022, accumulating a total of $1.3 trillion in savings from 2013 to 2022. Indian firms provided 60 percent of all hypertension medication prescriptions in the US, resulting in $25.3 billion in savings in 2022. 

The Indian Pharmaceutical Alliance (IPA), which is the foremost industry organization in the country, has apparently recommended that the government advocate for tariff exemptions on the last 40 percent of medications brought in from the US. Industry specialists think this action might enhance India’s bargaining power with little impact on revenue.