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U.S. to Impose 100 % Tariff on Branded Medicines — A Turning Point in Drug Trade Policy


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On September 25, 2025, former President Donald Trump announced via Truth Social that the United States will impose a 100 % import tariff on all branded or patented pharmaceutical products, effective October 1, 2025, unless the manufacturer is actively constructing a production facility within the U.S.
The Indian Express+5Financial Times+5Reuters+5

This sweeping tariff move excludes generic drugs, which constitute roughly 90 % of drug sales in the U.S., but targets high-value, patented medicines. Reuters+3Financial Times+3The Washington Post+3 The announcement marks a major escalation in trade policy, raising serious questions about drug access, supply chains, and international relations.


Background & Rationale

Tariff Strategy and Executive Powers

Trump’s decision extends his broader “reciprocal tariff” approach, under which importers from countries with trade surpluses with the U.S. face penalties. Previously, the pharmaceutical sector had largely been exempt from the most severe tariffs. 

He has justified the approach on the grounds of national security, protecting American manufacturing, and reducing dependence on foreign suppliers.  The tariff system is to be enforced under Section 232 of the Trade Expansion Act (which allows tariffs for national security reasons), and possibly under executive authorities such as the International Emergency Economic Powers Act (IEEPA). 

Exemptions & Conditions

To soften the blow and incentivize investment, the tariff will not apply to pharmaceutical companies that have “broken ground” or are “under construction” on a U.S. manufacturing plant. The In other words, those already building in the U.S. may be spared the 100 % duty. 

Still, many details remain vague: What constitutes sufficient construction? How will enforcement and verification work? And how will the policy interact with existing trade treaties that cap tariffs on pharmaceuticals?

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