The Indian pharmaceutical sector is one of the largest in the world, known for its wide range of generic medicines and vaccines. It is a key player in global drug production, supplying affordable medications to many countries.
The sector is driven by strong domestic demand, export growth, and a robust manufacturing base, supported by significant investments in research and development. India is a leader in producing and exporting generic drugs, with major companies focusing on both generic and innovative drug development.
The Impact of Trump’s Comments
Trump’s remarks aboard Air Force One raised concerns among investors. His statement that “pharma is going to start coming in at a level you haven’t really seen before” caught the market by surprise, leading to a sharp decline in stock prices.
He further clarified that pharmaceuticals are being treated as a separate category for tariffs, with an announcement expected soon. “We are considering pharma as a distinct category and will make an announcement in the near future, not too far off,” he added.
President Donald Trump hinted at the imposition of new tariffs on the pharmaceutical sector. Trump announced that pharma would be treated as a separate tariff category, reversing earlier expectations that the sector would remain exempt from trade restrictions.
What This Means for Indian Pharma Exports
Initially, Indian pharmaceutical exports, primarily consisting of generic drugs, were exempt from the broader 26 percent tariffs introduced under Trump’s “Liberation Day” plan. However, Trump’s latest announcement signals that this exemption may be reevaluated, potentially increasing healthcare costs in the U.S. and creating volatility in the market.
The Brokers View
Citi believes pharma companies will try to pass on the tariff hikes to payers. If the costs aren’t passed on to patients, the supply chain will have to absorb some of the increase. The brokerage also thinks a full pass-through of tariffs is difficult.
Jefferies suggests that removing import duties on pharma products from the US is possible. India imports pharma products worth around $800 million from the US, while it exports pharma products worth $8.7 billion to the country.
Aurobindo Pharma specializes in manufacturing generic pharmaceuticals and active pharmaceutical ingredients (APIs) for a global market, with a strong presence in both the U.S. and European markets. In Today’s session, the shares of the company fell upto 10.7 percent, making a low of Rs. 1049.85 per share compared to its previous closing price of Rs. 1176.05 per share.
Laurus Labs is a leading pharmaceutical company focusing on the development and production of APIs, formulations, and biotechnology products, with a special emphasis on antiretroviral and oncology treatments. In Today’s session, the shares of the company fell upto 9.4 percent, making a low of Rs. 561.55 per share compared to its previous closing price of Rs. 620.35 per share.
Ipca Laboratories is a prominent pharmaceutical company that manufactures both active pharmaceutical ingredients (APIs) and finished formulations, with a strong focus on the pain management and cardiovascular segments. In Today’s session, the shares of the company fell upto 9.2 percent, making a low of Rs. 1357.80 per share compared to its previous closing price of Rs. 1496.85 per share.
Lupin is a global pharmaceutical company known for its expertise in the development and manufacturing of generic and specialty medications, particularly in the areas of cardiology, dermatology, and antibiotics. In Today’s session, the shares of the company fell upto 8.4 percent, making a low of Rs. 1918.20 per share compared to its previous closing price of Rs. 2094.500 per share.
Granules India is a major manufacturer of pharmaceutical formulations and active pharmaceutical ingredients (APIs), specializing in the production of high-quality, cost-effective generic medicines. In Today’s session, the shares of the company fell upto 7.5 percent, making a low of Rs. 454.10 per share compared to its previous closing price of Rs. 491.25 per share.
Written by Sridhar J
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Dailyraven Technologies or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
