United States exempts 20 nations from 100% specialty drug tariffs

The United States has announced exemptions from a sweeping 100 per cent tariff on certain patented pharmaceutical products and their raw materials. Effective September 29, the zero-duty framework applies to select specialty medications imported from India and 19 other partner jurisdictions, including Bangladesh, Japan, the United Kingdom, and the European Union.

The exemptions target specific medical categories, such as orphan drugs for rare diseases, fertility treatments, cell and gene therapies, antibody-drug conjugates (ADCs), nuclear medicines, and certain veterinary pharmaceuticals. The U.S. Commerce Department stated that these nations qualify for the zero-percent ad valorem rate due to existing or potential trade and security framework agreements with Washington.

This decision follows a directive issued by President Donald Trump in April, which aimed to encourage domestic pharmaceutical manufacturing by imposing heavy duties on patented biologics and related components under Section 232 of the Trade Expansion Act. While the broader tariff targets many patented imports, the new guidance provides a narrow lane for these critical specialty products and their essential ingredients to enter the U.S. market duty-free.