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India’s pharma export engine faces US headwinds, strategic overhaul needed: Chakravarthi AVPS
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Nandita Vijayasimha, Bengaluru
October 01 , 2025
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India needs to adapt swiftly to safeguard US market presence as branded generics face the brunt of the sudden imposition of a 100% tariff on imported branded and patented medicines. This policy, enacted under Section 232 of US trade law, has sent shockwaves through the global pharmaceutical supply chains and presents both immediate financial implications and strategic considerations for Indian exporters, stated Chakravarthi AVPS, chairman, Federation of Pharmaceutical Enterprises (FOPE), Telangana & Andhra Pradesh.
The tariffs target branded and patented medicines, signaling a shift in US trade priorities to favor domestic manufacturers. While the fineprint is still awaited, experts anticipate that high-value branded generics and patented drugs will be impacted. For companies whose exports to the US represent a substantial share of the global pharmaceutical market, this translates to both potential revenue loss and increased operational complexity, he added.
The announcement has triggered market uncertainty, affecting stock valuations of Indian companies with significant US exposure. Beyond financials, the tariff could disrupt established supply chains, inflate costs, and delay market entry for new products. Indian manufacturers may also face competitive disadvantages if their US counterparts benefit from tariff protections, Chakravarthi told Pharmabiz.
One of the key challenges lies in India’s dependency on global supply chains, especially for active pharmaceutical ingredients (APIs). China remains a dominant supplier of raw materials, and any secondary ripple effects could exacerbate cost pressures. Indian companies are now evaluating options such as diversifying API sourcing to reduce reliance on single-country suppliers, investing in local or US-based manufacturing facilities to circumvent tariffs, enhancing inventory planning and logistics flexibility to absorb shocks, opting for technology-driven solutions, including advanced serialization and packaging innovations, to maintain supply chain transparency and compliance, stated Chakravarthi who is also an international trade & business relations expert in pharmaceuticals.
Industry leaders are exploring several avenues to maintain competitiveness and market access. These are, to set up local manufacturing units or forming partnerships with US-based companies to produce high-value drugs domestically, thereby bypassing tariff barriers. The industry is focusing on niche segments, prioritizing complex generics, biologics, and injectable drugs, where value addition and technical differentiation provide a buffer against tariff pressures. Further, utilising innovation in packaging and digital traceability to enhance product value perception in competitive markets. There is a need to reassess pricing models and optimize product portfolios to sustain margins while remaining attractive to US distributors and consumers, he said.
Indian pharmaceutical associations and government agencies are actively engaging with US authorities to seek clarity and possible relief measures. Strategic dialogue aims to advocate for phased or conditional tariff implementation, explore exemptions for essential medicines and promote bilateral cooperation in regulatory harmonization. Domestically, the government is expected to support the industry through incentives for localized production, export credit facilitation, and market diversification initiatives, he noted.
While the immediate picture appears challenging, the situation offers a strategic wake-up call. Companies embracing resilience and innovation are likely to strengthen supply chain independence, expand presence in high-value and regulated markets and improve global competitiveness through technology-driven solutions and regulatory compliance, said Chakravarthi.
The tariff imposition underscores a broader lesson in an era of geopolitical volatility and shifting trade priorities, foresight, and strategic collaboration are as critical as cost efficiency. Indian companies that can pivot quickly, adopt localized manufacturing strategies, and leverage their expertise in complex drug segments are poised to navigate the disruption successfully and emerge stronger, he said.
The 100% US tariff on branded pharmaceutical imports is a watershed moment for Indian pharma. While it poses immediate economic and operational challenges, it also reinforces the need for strategic resilience, market diversification, and innovation-driven growth. The coming months will test the industry’s agility, but with coordinated action between government, industry bodies, and individual companies, India can maintain its position as a global pharmaceutical powerhouse, said Chakravarthi.
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