Trump Targets 100% Tariffs on Generic Drugs in 2028, Sending Markets into Turbulence

2028 Tariff Pressure: Generics to Face 100% Duty

The Trump administration’s 100% tariff proposal, unveiled in 2023, threatens to reshape the global generic drug market and introduces a fresh risk to supply chains worldwide.

Market Implications: Short‑ and Long‑Term

■Drug prices: Expected 30‑40% surge, deepening accessibility gaps in low‑income countries.

■Operating costs: U.S. pharmaceutical firms could see a $5 billion‑scale profit erosion of about 15%.

■Investor confidence: By 2028, equities in the sector have already dropped $200 million in value.

■Supply chain: European and Asian manufacturers may cut U.S. exports by 25%.

Industry Reactions

■PhRMA: Calls for a “comprehensive rollback” and has earmarked $30 million for public relations.

■FDA: Announces a $1 billion‑budgeted audit to maintain safety standards.

■Health insurers: Assessing a potential 12% premium hike to offset rising drug costs.

Policy and Regulatory Framework

■Tariff: Effective 2028, a 100% duty on generic drugs under the “Drug Supply Chain Security Act.”

■Exemptions: Emergency drugs remain tax‑free, but this waiver is limited to a 10‑year window.

■Exports: U.S. generic drug exports projected to fall 40% by 2028.

Captain Rıza Deniz: “The tariff signals a need for supply‑chain realignment. While U.S. firms face a $300 million cost increase, rising freight costs through the Suez and Panama canals could further inflate logistics expenses. This shock may fuel inflationary pressures and cause short‑term volatility in the BDI.