NextFin news, On Thursday, October 9, 2025, Indian pharmaceutical stocks rallied following reports that the Trump administration in the United States is considering excluding generic drugs from import tariffs. This development eased export concerns and boosted investor sentiment in the pharma sector.
The Nifty Pharma index on the National Stock Exchange (NSE) surged over 1 percent in intra-day trading, outperforming the broader Nifty50 index, which saw only a marginal increase. Key pharma stocks such as Lupin and Aurobindo Pharma led the gains, each rising approximately 4 percent by mid-morning trading.
The Wall Street Journal reported that the US Commerce Department is scaling back its tariff investigation into pharmaceuticals, with officials indicating that the decision to exclude generic medicines from tariffs is not yet final but is being seriously considered. This move comes after earlier announcements of 100 percent tariffs on branded drugs, which have been delayed to allow ongoing trade negotiations.
India is a major supplier of generic medicines to the US, accounting for nearly 40 to 50 percent of generic drug imports. According to the Pharmaceuticals Export Promotion Council of India (Pharmexcil), Indian pharma exports to the US were valued at $10.52 billion in the financial year 2024-25, representing about 35 percent of India's total drug exports.
Indian pharmaceutical companies with significant exposure to the US market, including Lupin, Aurobindo Pharma, Dr Reddy's Laboratories, Sun Pharma, Cipla, and Zydus Lifesciences, stand to benefit from the potential tariff relief. For instance, Aurobindo Pharma earned 47 percent of its revenue from the US in FY25, while Dr Reddy's Labs earned 45 percent.
Market analysts noted that the tariff relief buzz has led to increased buying interest in pharma stocks, with Lupin and Aurobindo Pharma among the top movers. Other companies such as Granules India and Zydus Lifesciences also recorded gains ranging from 1.5 to 4 percent during the trading session.
The US tariff policy on pharmaceuticals remains subject to change, and officials have cautioned that the exclusion of generic drugs from tariffs is not yet finalized. However, the current reports have provided a positive impetus to the Indian pharma sector on October 9, 2025.
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