Despite Trump Tariff Fears, Indian Pharma Still Competitive: SEBI RA Varunkumar Patel

Pharma stocks witnessed selling pressure on Thursday, a day after US President Donald Trump spoke about 200% tariffs on the sector under Section 232. 

The pharma sector was initially exempted from the proposed 26% tariffs announced last month, offering short-term relief. However, the latest announcements have revived concerns that profit margins are being squeezed, leading to higher prices or supply exits, according to SEBI-registered analyst Varunkumar Patel. He remains optimistic: India remains cost-competitive and can retain dominance in the US generics market. 

Pharma Exports To US & Global Import Share 

The US is a strong market for Indian pharmaceutical companies. FY25 saw exports worth $8.95 billion, registering a healthy 14.3% year-on-year growth. Overall, India’s pharma exports reached $30.47 billion for the year, with the US accounting for nearly one-third of the total.

Globally, the US imported $212 billion in pharmaceutical products in 2024, making it the fifth-largest import category. While Ireland dominates the chart with a 28% share, India comes in after Germany and Switzerland with 5% share.

Indian Pharma: Who Stands To Lose The Most?

The top five Indian pharma exporters to the US in FY25 include Sun Pharma (34% of Indian exports), Dr Reddy’s, Cipla, Aurobindo Pharmaceuticals, and Lupin. 

Sun Pharma generated nearly $4.5 billion in sales, of which $3.4 billion (75%) came from the US. Dr. Reddy’s clocked $2.8 billion in total sales, with $1.2 billion (43%) from the US. Cipla, Aurobindo Pharma, and Lupin all derive between 44 and 47% of their revenues from US exports.
 

Patel noted that several Indian pharma companies are already beginning to diversify their presence in other regions such as the EU, Africa, and Latin America. 

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