India’s Generics Challenge: Navigating Tariffs, IPR, and Global Competition

Context

India’s pharmaceutical exports are facing rising challenges as the United States imposes higher tariffs and demands stricter intellectual property (IP) protections. These moves threaten the viability of Indian generics in their most critical export market. However, Indian generics remain the backbone of affordable healthcare worldwide, saving billions of dollars annually and ensuring access to life-saving medicines in both developed and developing countries.

Current Status of Indian Pharma

India is the largest supplier of generics to over 200 countries, earning the title “Pharmacy of the World.”
The U.S. is the biggest market, accounting for 31.35% of India’s pharma exports, importing 47% of its generics from India.
In 2022, Indian generics saved the U.S. USD 219 billion in healthcare costs.
The global generics market is projected to reach USD 614 billion by 2030, with India positioned as a key player.
Challenges include tariffs, Chinese API dependence, and rising global competition from China, Brazil, Eastern Europe.

Significance of Indian Generics

Affordable Medicines: Indian generics are priced 20–25% of branded drugs, ensuring access for diseases like diabetes, cancer, and HIV.
Global Public Health: Generics form over 90% of U.S. prescriptions and are vital for developing nations.
Economic Role: Contribute nearly USD 25 billion annually in exports and create millions of jobs domestically.
Strategic Leverage: Enhance India’s soft power, e.g., Vaccine Maitri during COVID-19.
Innovation Potential: India is advancing in biosimilars, vaccines, and low-cost R&D-based solutions.

Emerging Challenges

Trade Barriers:
- U.S. imposing 26% tariff + 25% penalty on pharma imports.
- Push for zero tariffs in bilateral talks without reciprocal gains.
IPR Pressures:
- Push for TRIPS-plus demands, stronger patent protections, data exclusivity, and extended monopolies.
- This delays entry of low-cost generics.
Domestic Constraints:
- Heavy dependence on China for APIs.
- Regulatory hurdles and fragmented R&D ecosystem.
Global Competition: Rise of hubs in China, Brazil, Eastern Europe.
Public Health Risks: Stricter IP regimes may increase global drug prices, deepening health inequities.

Policy Initiatives & Strategic Measures

TRIPS Flexibilities: India continues to use compulsory licensing for affordable medicines.
India–U.S. TRUST Initiative: Collaboration in biotech, pharma, and health technologies.
PLI Scheme & Make in India: Incentivising domestic production and reducing API dependence.
South–South Cooperation: Exploring joint ventures in Africa, Latin America, ASEAN.
Health-Tech Diplomacy: Sharing vaccine platforms and generic drug technologies with developing countries.

Strategic Shift Required

Move from short-term tariff concessions to long-term trade positioning.
Resist TRIPS-plus provisions that extend monopolies and restrict generics.
Diversify export markets beyond U.S. into Africa, Latin America, ASEAN, Central Asia.
Tie pricing/export concessions with technology transfer and joint R&D.
Use public health diplomacy to brand generics as a global public good, aligned with SDG-3: Health for All.
Build coalitions at WTO, WHO, BRICS to counter Big Pharma monopolies.

Conclusion

Indian generics are the lifeline of global healthcare, ensuring affordable medicines, saving billions in costs, and protecting millions of lives. To sustain its role as the Pharmacy of the Global South, India must resist unfair IP regimes, diversify export markets, strengthen domestic capacity, and leverage pharma diplomacy. By projecting generics as a global public good, India can align trade policy with global health equity while cementing its leadership in the international pharmaceutical landscape.

Source : TheHindu

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