Trump Gives Generic Drugmakers Two Years to Reshore Before Tariffs Hit

• President Trump announced Tuesday that imported generic drugs will keep a 0% tariff for two years from August 1, 2026, rising to 100% in August 2028 and 200% a year later
• No formal order has been issued; the White House says it intends to use Section 232 of the Trade Expansion Act, per Politico

In the latest tariff pivot from the White House, President Donald Trump announced Tuesday via Truth Social that generic drugs imported into the US will face a 100% tariff from August 2028, doubling to 200% in 2029, unless manufacturers move production onshore. A two-year grace period he framed as time for companies to build US plants.

The escalating schedule is designed, in Trump’s words, to “RESHORE Generic Pharmaceutical Production into America,” with the tariffs acting as a penalty for companies that don’t invest in US facilities within the window. A White House official told Politico the administration intends to use Section 232 of the Trade Expansion Act of 1962, the same national security authority behind the branded drug tariffs, though no formal order has been released.

The move extends tariff pressure to a segment that had so far escaped it. When the administration finalized duties of up to 100% on branded and patented medicines in April, generics were explicitly carved out, alongside exemptions for companies with US build plans and lower rates for trading partners with deals in place. Trump said the branded drug policy will not change. The scale here is different, though: generics account for roughly 90% of US prescriptions filled, and the FDA estimates about 70% of them come from overseas, according to the Financial Times.

Indian manufacturers supply nearly half of all generic medicines consumed in America, and the US takes about a third of India’s pharma exports, CNBC reported — while Chinese firms dominate the upstream supply of active pharmaceutical ingredients. Vontobel analyst Stefan Schneider told FirstWord Pharma the rules would predominantly hit Chinese and Indian companies plus Sandoz, which generates around 22% of its sales in the US but has little production there and is closing its remaining US sites this year. Sandoz told the AWP news agency it’s too early to assess implications, per a SwissInfo report.

The Association for Accessible Medicines said it needs more policy detail and pushed for the administration to address existing barriers to domestic production. CEO John Murphy III said in a statement that the industry is committed to policies that stabilize the sector while ensuring patients keep “reliable options for affordable medicines,” and pointed to legislative and regulatory fixes the industry wants to discuss with the administration and Congress.