The United States has announced a 100% ad valorem duty on imports of patented pharmaceuticals and associated active pharmaceutical ingredients (APIs), sending shockwaves through India's pharmaceutical sector. The US is India's single largest pharmaceutical export destination, absorbing nearly 40% of India's total pharma exports valued at approximately $28 billion annually.

The move targets generic drug manufacturers who produce affordable versions of patented medicines. India, known as the pharmacy of the world, supplies over 60% of global vaccine demand and 20% of global generic medicines. Industry experts warn this could disrupt global medicine supply chains and significantly impact Indian pharma companies' revenues. The Indian government is expected to raise the issue through diplomatic channels and at the World Trade Organization.