The Indian Pharmaceutical Alliance – IPA which happens to represent some very large Indian drugmakers, has gone on to convey to the government to go ahead and, if possible, consider zero tariffs when it comes to US drug imports. This is done as a response to the Trump administration planning a flat 25% import tariff or the reciprocal tariff on the Indian pharma exports.
The Indian Pharma Alliance which happens to represent large homegrown pharma companies that happen to have a prominent exposure to the US pharma market, happens to feel that decreasing tariffs on US imports may not cost a lot to India and, for that matter, can even convince the Trump administration to curtail and offer a relief on tariffs.
As per the secretary general of the Indian Pharma Alliance, Sudarshan Jain, India supplies $9 bn worth of pharma products to the US as exports. On the other hand, they supply $800 mn – 60% of the US exports is what we have made the tariff zero. Make others also zero is what IPA is also saying.
Jain added that they are just giving a viewpoint as the government is also working on it. He further said that the tariffs are anyways going to elevate the medicine cost to the US patients and may as well lead to shortages since the manufacturers will either have to pass the tariff expense or even exit the products that aren’t viable at all. At the end of the day, common sense says that if there’s a 25% tariff on low-value products, then it is going to be non-viable.
Sudarshan says that the manufacturing cost in India is one-fourth of the US. At the same time, it is going to take a minimum of 3-4 years for one to set up a new manufacturing plant.
Indian exports happen to be very small when compared to Europe, as the latter exports drugs of more than $200 bn to the US – it is more like a volume game.
Certain stalwarts from the Indian pharma manufacturing space opined that the IPA members have gone on to echo the viewpoints on the cost of medicines becoming more expensive for the US patients. The fact of the matter is that all this will indeed make it much costlier for US consumers or the intermediaries. Shifting all the products from across the globe to the US is not a practical exercise.
It is worth noting that the US charges zero tariffs on the Indian pharma imports whereas India charges almost 10-11% on US pharma imports which happen to be mostly high-value as well as patented for treatment of diseases such as cancers, rare and autoimmune diseases, etc. The Indian government in the latest budget that has gone by has already announced a complete exemption of 36 lifesaving cancer drugs, rare and chronic diseases from the customs duty so as to make it much more affordable for patients in India. Many of such products happen to be imported as well as sold in India by pharma companies from the US.
