Trump Announces 100 Per Cent Tariff on Generic Drugs From 2028

Donald Trump has announced a new package of tariffs on generic drugs manufactured overseas, to take effect in 2028.

The announcement, made in a social media post on Tuesday, came just three months after the president issued a proclamation stating that generic pharmaceuticals "are not subject to tariffs at this time", while noting that the decision "will be reassessed in one year."

Under the reversal, generic drugs will continue to be imported tariff-free until 1 August 2028, when a 100% tariff would be imposed "for a one year period of time, and 200% thereafter." Trump said the aim of the policy was to coerce drug makers into building manufacturing plants in the United States.

The president did not state what legal authority he was claiming to impose the tariffs. The question is not academic: the projected 200% rate would take effect in August 2029, six months after the end of his final term, meaning the policy as announced would bind a successor administration that has not yet been elected.

Generic medicines account for the large majority of prescriptions filled in the United States and are the principal mechanism by which drug costs are held down. Most are manufactured in India and China, and the margins are thin — which is precisely why the sector consolidated overseas in the first place. Tariffs of the magnitude described would either be absorbed by manufacturers who have little room to absorb them, or passed to patients and insurers.

The announcement came on a day dominated by the war with Iran. Defence Secretary Pete Hegseth told the Senate that the conflict has cost $37.5bn so far while requesting billions more, refused to say whether the US military has the ability to destroy the Iranian facility buried beneath Pickaxe Mountain, and said the Pentagon believes the administration has "all the authorities necessary" to continue the war. A senior US military commander, pressed on whether strikes on Iran can end the conflict, said "air power's got limits."

Elsewhere on Tuesday, Trump agreed to provide Saudi Arabia with nuclear enrichment infrastructure, according to reports, and defended new tariffs on Canada with the assertion that "without us, there's no way they can survive". Canada said it was ready to "intensify" trade talks. The administration also halted more than $1bn in Medicaid funding to California and Minnesota.

Democrats said they will repeal Trump's tariffs — a commitment that, given the 2028 start date, would require them to hold the presidency or a veto-proof majority by then.

Reported from the Guardian.