Trump announces 100% tariff on generic drugs from August 2028, rising to 200% a year later

The tariff timetable

President Donald Trump announced on Truth Social that all generic drugs imported into the United States will continue to enter duty-free for two years starting 1 August 2026. After that window, tariffs rise to 100% for one year beginning in August 2028, then climb to 200% thereafter. The policy leaves existing measures on patented, branded, and innovative medicines unchanged.

Starting August 1, 2026, all generic drugs imported into the United States will continue to be subject to a zero percent tariff for a period of two years, after which tariffs will be raised to 100% for a period of one year, and then to 200% thereafter.

Reshoring production

Trump framed the move as an effort to bring generic pharmaceutical manufacturing back to the United States. Companies that choose not to build factories and tooling within the allotted timeframe will face penalties. The president said the policy's goal is to protect people in the United States.

This action aims to relocate generic pharmaceutical production back to America, along with imposing penalties on companies that decide not to build factories and equipment within the specified timeframe they are given. The goal of this policy is to protect people in the United States.

April executive order context

In April, Trump signed an executive order imposing 100% tariffs on branded medicines imported into the US if manufacturers did not agree to lower prices or commit to producing in the United States. Some of the largest pharmaceutical companies reached agreements with the US government to exempt their products from those tariffs. Generic drugs were excluded from that April order, even though they account for more than 90% of pharmaceuticals sold in the US, according to data from the US Food and Drug Administration.

Commerce Department review

Trump had given his Commerce Secretary one year to reassess the situation and recommend, if necessary, new measures on generic drug imports. The new tariff schedule follows that review window. The US Trade Representative, Jamieson Greer, told CNBC that further trade actions are expected soon, though he could not specify a timeline. Greer's office had launched investigations in mid-March into practices including structural overcapacity and the integration of raw materials from forced labour into goods shipped to the US. In early June, Greer proposed a 12.5% surcharge on roughly 45 countries that his office said had failed to ban imports of forced-labour goods.

We should see movement soon, though I cannot specify the timeline.

Broader trade backdrop

The new generic-drug tariffs arrive nearly five months after the Supreme Court struck down Trump's first round of tariffs. Washington is preparing to make permanent the duties targeting its main trading partners, including the European Union. Those permanent surcharges would replace the temporary 10% tariffs Trump imposed earlier.