Trump’s “America First” Agenda May Shape Indian Pharma’s Path in US Market

Experts believe that the focus on cost-effective healthcare solutions may encourage continued reliance on India for these essential medicines, even as the US aims to protect its domestic manufacturing sector.

With Donald Trump elected as the 47th US President, India’s pharmaceutical sector examines the potential impacts of an intensified “America First” agenda. This approach, aimed at boosting US manufacturing, may affect trade terms and supply chain relations between the two nations. 

While Indian pharma faces possible setbacks from increased tariffs, experts also see potential benefits in the form of more robust demand for generics, diversification of the US supply chain away from China, and expanded access to the American market.

Higher Tariffs, Stable Generic Demand

The pharmaceutical industry in India has been a critical supplier of affordable generics to the US, with exports making up a substantial portion of its trade revenue. 

However, Trump’s trade policies could introduce barriers in the form of higher tariffs, impacting the cost of Indian pharmaceuticals entering the US, noted Prashant Khadayate, Director of Lifesciences Consulting & Research at GlobalData.

"Higher tariffs on Indian pharmaceutical exports could indeed be a challenge, but the U..’s ongoing need for cost-effective healthcare solutions will sustain demand for India’s quality generics," Khadayate added.

While tariffs may complicate access, Indian generic drug manufacturers have a significant market position due to their reputation for affordable, high-quality medicines. 

Experts believe that the focus on cost-effective healthcare solutions may encourage continued reliance on India for these essential medicines, even as the US aims to protect its domestic manufacturing sector.

Boost for Indian Biosimilars

An additional boost for Indian pharma could stem from the US effort to reduce dependence on Chinese suppliers in favor of more diverse sourcing. 

This shift is aligned with Trump’s stance on China, which could open doors for Indian manufacturers, particularly in biosimilars and specialized generics. 

"Indian manufacturers, especially Contract Development and Manufacturing Organizations (CDMOs), are in a prime position to benefit from policies like the Biosecure Act. The Act encourages sourcing pharmaceuticals and APIs outside of China, giving Indian companies a growth pathway without competing directly with U.S. manufacturers," Khadayate explained. 

Indian companies involved in biosimilars — highly specialized versions of generic drugs — may also find increased opportunities in the US due to their relatively lower competition in this segment. 

By focusing on innovation and advanced manufacturing capabilities, Indian CDMOs are preparing to meet the demand for quality and secure drug sources in the American healthcare market.

Strengthening US-India Healthcare Partnerships

Sudarshan Jain, Secretary-General of the Indian Pharmaceutical Alliance (IPA), emphasized India's vital role in providing affordable medicines to the US, and he noted the significance of maintaining strong partnerships to bolster healthcare resilience. 

"India’s contribution to the U.S. healthcare system through affordable, quality-assured medicines is critical. This partnership will continue to develop, fostering a resilient supply chain for active pharmaceutical ingredients (APIs) and supporting global healthcare security," he said.

Indian pharma firms with existing facilities in the U.S. may also benefit from incentives designed to boost domestic production. 

According to Khadayate, CDMOs with U.S.-based operations are positioned well for competitive growth as the demand for resilient and secure healthcare solutions increases. 

"These companies are investing in advanced manufacturing technologies and scaling up their facilities to align with U.S. requirements," he said, pointing to a readiness among Indian CDMOs to adapt to shifting trade dynamics.

Long-Term Implications for India’s Health Tech and Devices

Despite potential opportunities in pharma and biosimilars, India's health tech, telemedicine, and medical device sectors may face slower progress in breaking into the US market. 

Nonetheless, the trend toward sourcing outside China could benefit Indian firms looking to establish long-term US partnerships. 

With a rapidly expanding domestic market, these sectors might experience gradual entry into the US, supported by anti-China policies and the search for alternative, reliable suppliers.

The ongoing US-India collaboration in pharmaceuticals and biosimilars is seen as a crucial step toward a diversified, secure healthcare ecosystem. 

For India’s pharma sector, Trump's return to office presents a mix of potential barriers and opportunities as the country balances tariff risks with prospects in biosimilars, CDMO expansion, and strengthened US-India partnerships aimed at healthcare security.

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