Trump outlines plans for up to 200% tariffs on generic drug imports starting in 2028

President Donald Trump on Tuesday said generic drugs imported into the U.S. will face zero tariffs for two years starting August 1, before a 100% levy takes effect in August 2028 and rises to 200% a year later.

The phased schedule is intended to push generic drugmakers to move production onshore, Trump said in a social media post Tuesday, describing the escalation as “a penalty” for companies that don’t build plants and facilities in the U.S. within the grace period.

Tariffs on patented and branded drugs will remain unchanged, Trump said. 

In a series of agreements with the Trump administration, over a dozen major pharmaceutical firms, such as Eli Lilly (LLY), Pfizer (PFE), and Novo Nordisk (NVO), have committed to cutting prices across their existing and pipeline drug portfolios.

Trump has used tariff threats and his most-favored-nation pricing policy to press drugmakers into charging Americans no more than patients in other high-income countries.

The President signed an executive order in April imposing 100% tariffs on branded pharmaceuticals imported into the U.S. unless ⁠manufacturers ​agree to government drug pricing ​deals or commit to making their products domestically.

Of note, the U.S. accounts for about a third of India’s pharma exports, mostly cheaper versions of popular drugs, annually. Chinese firms dominate the upstream supply of active pharmaceutical ingredients, such as amoxicillin and heparin.