In a significant development that sent ripples across global pharmaceutical markets, U.S. President Donald Trump has written to 17 of the world’s top drugmakers. It urges them to lower the prices of medicines sold in the United States.
The letter, addressed to pharma giants including Pfizer, Eli Lilly, and Novo Nordisk. These are called for aligning U.S. drug prices with those in other developed nations, particularly in Europe.
The communication further instructed companies to implement a “Most Favoured Nation” (MFN) pricing model within 60 days, a strategy that mandates firms to offer their lowest global rates to American consumers.
Adding pressure, the letter also proposed that select medicines be sold directly to patients at rates negotiated by insurance providers, bypassing traditional markups.
Although no Indian pharmaceutical companies were among the recipients of the letter, the move triggered sharp reactions in Indian equity markets, particularly in pharma stocks. The Nifty Pharma index tumbled 2.45% during intra-day trade on Friday, marking its third consecutive session of losses as investor sentiment turned cautious over the potential knock-on effects for Indian exporters.
At 2:11 PM, Several frontline Indian pharma stocks took a dip:
While the U.S. directive is currently aimed at multinationals, Indian drug manufacturers, many of whom derive a significant portion of revenue from the U.S. market, could be indirectly impacted.
India exports nearly $10 billion worth of pharmaceutical products to the U.S. annually, with a major share coming from branded generics, a category already operating on wafer-thin margins.
Experts caution that any further compression in U.S. drug prices, especially if the MFN model is enforced, could render exports financially unsustainable for Indian drugmakers.
This isn’t the first time. Back in May, Trump had issued a similar appeal to slash drug prices. At the time, analysts had already flagged concerns that the U.S. push for pricing parity might intensify the challenges faced by Indian pharma firms.
The recent letter reinforces those fears, highlighting how global policy shifts, even those not directly targeting Indian firms, can have an outsized impact on the country’s healthcare export ecosystem.
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