Nifty pharma slumps nearly 2 pc after Trump announces tariff plan on generic drug imports

Mumbai: India’s pharmaceutical sector dipped notably on Wednesday after US President Donald Trump outlined a phased tariff plan on imported generic medicines, fuelling concerns over the long‑term outlook for drugmakers that rely heavily on US sales.

The Nifty Pharma index fell nearly 2 per cent in early trade, making it the worst‑performing sectoral index on the National Stock Exchange in early trade.

The Nifty Pharma index fell 1.85 per cent to 25,610 against Nifty, down 169 points or 0.70 per cent at 24,017.

Selling was broad‑based across the sector even as Gland Pharma led losses down 4.54 per cent. Aurobindo Pharma was down 2.89 per cent, while Glenmark was down 3 per cent and Zydus Lifesciences fell about 2.28 per cent.

Ajanta Pharma, Sun Pharma, Alkem Laboratories, Dr Reddy’s Laboratories, Mankind Pharma and Divi’s Laboratories also traded lower by 1.3 to 3 per cent. Among Nifty 50 constituents, Cipla, Sun Pharma and Dr Reddy’s were among the top early losers, down about 1.29 to 1.95 per cent.

Trump has outlined a staggered tariff regime for generics, under which imports would remain duty‑free for two years from August 1, 2026, rise to 100 per cent from August 1, 2028, and then to 200 per cent a year later.

The policy aims to encourage pharmaceutical manufacturing to shift to the United States, Trump said on Truth Social, adding that tariffs on patented and branded medicines will remain unchanged.

The announcement triggered a selloff in Indian pharmaceutical companies, which are among the largest suppliers of affordable generic medicines to the US.

Some analysts noted that manufacturing generic medicines in the US would incur 25-30 per cent higher costs than in India and shifting production is hard to be accomplished in the two-year transition period allowed by Trump.

IANS