President Donald Trump plans to place tariffs on generic drug imports, building on the 100% tariff he imposed on patented pharmaceutical products in April. While that policy exempted generic drugs and biosimilars for the time being, the White House said it would reassess the exemption within a year.
Here are three things to know from the latest announcement, made in a July 21 Truth Social post:
- The tariff schedule would be rolled out over three years. Starting Aug. 1, generic drugs will continue entering the U.S. tariff-free for a two-year period. After that, the tariff rises to 100% for one year, then to 200% thereafter.
- President Trump said the schedule is meant to “reshore” generic pharmaceutical production into the U.S., calling the escalating tariffs a “penalty” for companies that do not build manufacturing plants and equipment domestically within the two-year window.
- President Trump said the policy on patented, branded or innovative drugs “will remain as is.” Under the April policy, those tariffs are set to take effect July 31 for large companies and Sept. 29 for smaller firms, with reduced or zero rates available to companies that reach most favored nation pricing agreements with HHS and onshoring agreements with the Commerce Department. This announcement effectively replaces the one-year review window for generics with a defined, longer timeline.
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