Drug Supply Chain: This Again? Trump Proposes Tariff on Generic Drugs

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Drug Supply Chain: This Again? Trump Proposes Tariff on Generic Drugs

Deutsche Bank

Research

North America Industry Date

Healthcare Technology & Drug Supply Chain 23 July 2026 Distribution

This Again? Trump Proposes Tariff on

George Hill Generic Drugs

Research Analyst

+1-212-2507822

Generics Getting the Brand Treatment, Trump Proposes Tariffs: The Trump

administration recently floated a plan to implement substantial tariffs on generic Maxi Ma, CFA

drugs as part of an initiative to reshore pharmaceutical manufacturing. The Research Associate

+1-901-338-2175 proposed schedule states that a 100% tariff will be imposed on imported generic

drugs in 2028 for a one-year period, and 200% thereafter. The stated goal is to Liz Li

incentivize companies to build manufacturing plants and equipment within the Research Associate

U.S. The administration intends to use Section 232 of the Trade Expansion Act of +1-617-251-2782

1962, which addresses national security risks from import reliance. While a formal

Graham Harris order has not yet been released, this follows a previous Commerce Department Research Associate

investigation that resulted in tariffs on brand-name pharmaceuticals, though with +1-929-701-6999

several exemptions for major drugmakers and companies planning U.S.

investment. The new policy for generic drugs will not affect the existing policy on

branded drugs. The announcement seemingly suggests a potential for generic

drug prices to increase if tariffs are implemented given the lower cost of labor and

manufacturing abroad. Per our recent note on drug supply chain data, generic

drugs represent ~90% of total volumes in the U.S. and ~43% of total dollar sales.

However, there are lots of complexities with the implementation of tariffs and