On April 2, 2026, President Trump issued a Section 232 proclamation titled “Adjusting Imports of Pharmaceuticals and Pharmaceutical Ingredients into the United States” introducing a new tariff framework for pharmaceuticals and their ingredients.
Under this proclamation, a 100% ad valorem duty will apply to patented pharmaceuticals and their associated ingredients listed in Annex I. This applies to goods entered for consumption or withdrawn from warehouse for consumption on or after July 31, 2026, for companies listed in Annex III, and on or after September 29, 2026, for all other companies. This rate will stay in place unless modified or terminated by future action.
A tiered structure applies to companies that engage in approved or anticipated onshoring commitments. Patented pharmaceuticals and associated ingredients produced by companies with Secretary-approved plans to onshore production, as well as those with plans in progress, will be subject to a 20% ad valorem duty, which will increase to 100% on April 2, 2030. Companies that are eligible for this tariff treatment and that have entered into MFN pharmaceutical pricing agreements with the Secretary of Health and Human Services may receive a 0% duty rate through January 20, 2029, as per the agreement listed in Annex II.
The proclamation also includes lower rates for certain countries with trade agreements. Products from the European Union, Japan, South Korea, Liechtenstein, and Switzerland will generally face a 15% duty, unless another lower rate applies under specific provisions. Products from the United Kingdom will face a 10% duty, with the possibility of reduction to 0% under a future bilateral agreement addressing pharmaceutical pricing.
There are also full exemptions for specific categories of pharmaceutical products. A 0% duty applies to orphan drugs pursuant to the Orphan Drug Act, nuclear medicines, plasma-derived therapies, fertility treatments, cell and gene therapies, antibody drug conjugates, medical countermeasures related to chemical, biological, radiological, and nuclear threats, and other specialty products identified by the Secretary. Pharmaceutical products for animal health may also qualify for a 0% rate where urgent health needs or jurisdictional criteria are met and formally determined by the Secretary in consultation with relevant agencies.
Generic pharmaceuticals and their ingredients are not subject to these tariffs at this time. However, the Secretary will review this within one year to decide if future action is warranted. U.S.-origin pharmaceutical products are also not subject to these tariffs, and duty drawback is permitted. Goods entering foreign trade zones must be admitted under privileged foreign status, ensuring applicable rates are fixed at the time of entry into consumption.
The proclamation also explains how these tariffs work alongside existing duty rates. Where products are subject to both Column 1 duties under the HTS and Section 232 tariffs, the combined rate will be the applicable rate specified in the proclamation, subject to limitations. If the existing Column 1 duty rate is higher, that rate will apply instead. If multiple tariff provisions apply, the lowest applicable rate will govern.
The Secretary, working with U.S. CBP and other agencies, will oversee the program. This includes setting the rules for onshoring plans, reviewing and monitoring company progress, and requiring regular reports, which may be audited. If a company does not meet its commitments or provides incorrect information, tariffs can be increased or applied retroactively. Any updates to the tariff schedule or related rules will be published in the Federal Register.
The Annexes are available at the following link: Pharmaceuticals Imports Annexes I-II-III-IV
The full text of the proclamation can be found here: Adjusting Imports of Pharmaceuticals and Pharmaceutical Ingredients into the United States