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Hyderabad: Indian drugmakers are hoping that bilateral discussions between the country and the United States will help them steer clear of President Donald Trump's plan to levy at least 25 per centtariffs on pharmaceutical imports, a trade association said.
India, which calls itself the 'pharmacy of the world', makes cheaper generic versions of complex innovative drugs in its massive factory clusters and exports them to over 200 countries, of which the US is its biggest market, government data shows.
In fiscal 2024, the exports to the US were worth $8.7 billion, or about 31 per cent of total pharma exports, per data from government-backed trade body Pharmexcil. Trump's threat to raise tariffs sent shares of Indian drugmakers sliding on Wednesday.
"This (tariff) matter will be discussed through bilateral engagements between the two countries and further steps will be determined accordingly," Sudarshan Jain, secretary general of the Indian Pharmaceutical Alliance (IPA), said in a statement on Wednesday.
"We are confident that continued dialogue among stakeholders will help address the subject."
According to research firm IQVIA, nearly half of all prescriptions for generic medicines in the US in 2022 were supplied by Indian drugmakers, saving the healthcare system about $408 billion and underscoring the Indian industry's role in access to affordable, quality-assured medicines.
"This (tariff) move is going to be inflationary to the US as they don't have the requisite manufacturing infrastructure in-house to replace the scale of supply that India does," said Vishal Manchanda, an analyst at Systematix Institutional Equities.
The IPA represents some of India's biggest drugmakers, including Sun Pharmaceutical, Dr Reddy's, Cipla and Zydus Lifesciences, as well as the local units of US firms like Abbott.
Earlier this week, Sun Pharma Managing Director Dilip Shanghvi told local media that the tariffs, if imposed, will be passed on to consumers.