Indian Pharma's Twofold Strategy to Combat US Tariff Hike

Indian pharmaceutical manufacturers are devising a two-fold strategy to counter the upcoming 25% US tariff on Indian goods, including drug exports, amid concerns about rising medicine costs in the American market. Girdhar Gyani, Director General of the Association of Healthcare Providers (India), expressed worries over the financial strain this tariff would place on both Indian exporters and American consumers.

Currently, India supplies around 47% of the US pharmaceutical market, primarily through affordable generic drugs. "Should the United States enforce this 25% tariff, drug delivery costs in the US are expected to soar. Our predictions suggest an annual increase in American drug prices by 20 to 25%, burdening the market by approximately USD 6 to 7 billion," Gyani stated.

To circumvent these challenges, Indian firms are preparing by either ramping up production in their US and Mexico-based facilities or focusing on higher-value combination drugs, which offer added convenience with potentially higher pricing despite comparable production costs.

Gyani also emphasized the importance of ongoing diplomatic discussions between New Delhi and Washington to mitigate these issues. These negotiations could eventually lead to a reduction or reassessment of the tariff policy. The recent executive order signed by President Donald Trump imposed a blanket 25% tariff on all Indian goods, without exceptions.

Pharmaceutical trade is a cornerstone of the India-US economic relationship. Experts remain hopeful that diplomacy can avert the full impact of the imposed tariffs. (ANI)

(With inputs from agencies.)