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US to exempt generic drugs from tariffs for two years
After the August 1 start date, duties are set to rise to 100% for one year, then 200% thereafter, signaling a move away from a permanent carve-out.
The US will keep tariffs at 0% on imported generic drugs for two years starting August 1, before raising duties sharply, under an announcement by President Donald Trump that extends the administration’s pharmaceutical tariff push, according to information cited in a Reuters report.
Under the timeline Trump described, generic drug importers would face a tariff rate of zero for two years, then 100% for one year, followed by 200% after that. The move is expected to apply to generic drugs that had previously been carved out from earlier action.
Earlier this year, the administration invoked Section 232 of the Trade Expansion Act, imposing tariffs of up to 100% on patented, branded pharmaceutical imports and their active ingredients, while explicitly excluding generics and biosimilars. The new schedule suggests that exemption will not be permanent.
The administration’s shift matters for drug affordability because generics account for the large majority of US prescriptions and often operate on thin margins, meaning much higher future tariff rates could have a larger impact than tariffs aimed first at higher-margin branded drugs.