{"id":55499,"date":"2025-09-29T19:03:04","date_gmt":"2025-09-29T13:33:04","guid":{"rendered":"https:\/\/www.nextias.com\/ca\/?p=55499"},"modified":"2025-09-30T11:00:41","modified_gmt":"2025-09-30T05:30:41","slug":"health-care","status":"publish","type":"post","link":"https:\/\/www.nextias.com\/ca\/editorial-analysis\/29-09-2025\/health-care","title":{"rendered":"Weaponising Health Care: US Tariffs on Patented Drugs"},"content":{"rendered":"\n<p><strong>Syllabus: GS2\/Issues Related To Health<\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Context<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The recent announcement of <strong>100% tariffs on imports of patented medicines<\/strong> by the United States (US) has effectively weaponised access to healthcare<strong> in the US.<\/strong><\/li>\n<\/ul>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-background\" style=\"background-color:#fff2cc\"><tbody><tr><td><strong>Tariff Breakdown By US<\/strong><br>&#8211; <strong>Cap of 15% Tariff: <\/strong>On Imports From European Union and Japan (together they account for <strong>nearly 75% of US pharma imports<\/strong>);<br>&#8211; <strong>100% Tariffs:<\/strong> Remaining countries;<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>US Pharma Landscape<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Patented Drugs Vs Generics: Patented<\/strong> drugs account for around <strong>10% of household medical spending,<\/strong> representing <strong>about 87% of spendings<\/strong> in pharmaceuticals.\n<ul class=\"wp-block-list\">\n<li>However, Generic drugs account for 90% of prescriptions in the US, but only about 13% spend on it.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Domestic Innovation vs. Foreign Production:<\/strong> US leads in <strong>drug discovery and intellectual property<\/strong>, but much of the manufacturing \u2014 especially for complex biologics and specialty drugs \u2014 is outsourced to <strong>global Contract Development and Manufacturing Organizations (CDMOs).<\/strong><\/li>\n\n\n\n<li><strong>Global Sourcing: <\/strong>The US imports a significant portion of its patented drugs from countries like Switzerland, the UK, and Singapore.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Possible Implications<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Economic Fallout: <\/strong>According to an <strong>Ernst &amp; Young study,<\/strong> 25% tariff on patented drugs could raise annual drug costs by $51 billion.\n<ul class=\"wp-block-list\">\n<li>The financial burden on American patients and insurers could be even more staggering with the <strong>new 100% tariff<\/strong>.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>On Insurance Companies:<\/strong> They may pass on the increased costs to policyholders, exacerbating the already <strong>high out-of-pocket expenses<\/strong> for life-saving treatments.<\/li>\n\n\n\n<li><strong>Supply Chain Vulnerabilities:<\/strong> The US pharmaceutical supply chain is deeply intertwined with global partners.\n<ul class=\"wp-block-list\">\n<li>Disruptions due to tariffs could lead to shortages or delays in critical treatments.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Impacts on India\u2019s Pharma Industry<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>India is the <strong>largest supplier of generic medicines<\/strong> to the US, accounting for over <strong>$10.5 billion in exports in FY25<\/strong>.\n<ul class=\"wp-block-list\">\n<li><strong>India\u2019s generics industry<\/strong> remains<strong> exempt from the new tariffs.<\/strong><\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Contract Drug Manufacturing Organizations (CDMOs) <\/strong>may face pressure as the US pushes for domestic production.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Concerns For India<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Issue of Uncertainty: <\/strong>There is <strong>uncertainty around Active Pharmaceutical Ingredients (APIs) <\/strong>\u2014 dominated by India and China.\n<ul class=\"wp-block-list\">\n<li>Any expansion of tariffs to include <strong>generics or biosimilars<\/strong> could severely disrupt one of India\u2019s strongest export sectors.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Limited Exposure to Patented Drugs:<\/strong> Indian companies like Sun Pharma have modest exposure to the patented drug market in the US, with only 17% of their revenue tied to such products.<\/li>\n<\/ul>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-background\" style=\"background-color:#ebecf0\"><tbody><tr><td><strong>Patent vs Generic Drugs<\/strong><br>&#8211; <strong>Patented Drugs:<\/strong> These are medicines protected by intellectual property rights, typically for 20 years.<br>1. These drugs are usually expensive due to monopoly pricing and high development costs.<br>2. <strong>Medicines Patent Pool (MPP) of WHO:<\/strong> It facilitates<strong> voluntary licensing of patented drugs<\/strong> to improve access in low- and middle-income countries<strong>.<\/strong><br>&#8211; <strong>Generic Drugs:<\/strong> These are <strong>copies of patented drugs<\/strong> made <strong>after the patent expires<\/strong>.<br>1. They contain the <strong>same active ingredients<\/strong> and are <strong>therapeutically equivalent.<\/strong><br>2. These drugs are significantly cheaper due to competition and absence of R&amp;D costs.<br>3. They need to meet rigorous standards for safety, efficacy, and bioequivalence.<br>4. <strong>International Nonproprietary Names (INN) System of WHO:<\/strong> It ensures that generic drugs are clearly identified and safely prescribed worldwide.<br>&#8211; The <strong>Indian Pharmacopoeia Commission<\/strong> promotes rational use of generics and sets national standards for drug quality.<br>1. India is a global hub for generic drug production, supplying affordable medicines to over 200 countries.<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Way Forward<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Countries heavily reliant on US demand <strong>need to accelerate efforts to diversify their export markets<\/strong> and forge <strong>alternative trade alliances.<\/strong><\/li>\n\n\n\n<li>Indian firms may need to consider <strong>shifting manufacturing to US-based facilities<\/strong><strong>or CDMO partners <\/strong>to bypass future trade barriers and remain competitive under the new regime.\n<ul class=\"wp-block-list\">\n<li>It needs to expand its pharmaceutical footprint in <strong>Africa, Latin America, and the Middle East<\/strong>\u2014regions where demand for affordable medicines is growing.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-background\" style=\"background-color:#fff2cc\"><tbody><tr><td><strong>Daily Mains Practice Question<\/strong><br><strong>[Q]<\/strong> Discuss how the recent imposition of 100% tariffs on imported patented drugs by the United States reflects the weaponisation of health care. What role can India play in mitigating its impact on access to affordable medicines?<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p><a href=\"https:\/\/www.thehindu.com\/opinion\/editorial\/weaponising-health-care-on-the-trump-tariffs-on-imported-medicines\/article70105428.ece\" rel=\"nofollow noopener\" target=\"_blank\">Source: TH<\/a><\/p>\n\n\n\n<div class=\"wp-block-buttons is-layout-flex wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link wp-element-button\" href=\"https:\/\/www.nextias.com\/ca\/wp-content\/uploads\/2025\/09\/UPSC-Editorial-Analysis-29-September-2025.PDF.pdf\">Download PDF<\/a><\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>The recent announcement of 100% tariffs on imports of patented medicines by the United States (US) has effectively weaponised access to healthcare in the US.<\/p>\n","protected":false},"author":15,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[22],"tags":[],"class_list":["post-55499","post","type-post","status-publish","format-standard","hentry","category-editorial-analysis"],"acf":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/55499","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/comments?post=55499"}],"version-history":[{"count":3,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/55499\/revisions"}],"predecessor-version":[{"id":55551,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/55499\/revisions\/55551"}],"wp:attachment":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/media?parent=55499"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/categories?post=55499"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/tags?post=55499"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}