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President Donald Trump speaks during a speech to a joint session of the congress in the living room … [+]
During his speech to the congress on March 4, President Trump called for mutual rates for trading partners. For example, if a country imposes a rate on medicines imported from the US, the US will impose the same rate on medicines that exports land to us. This policy can take effect on 2 April. Whether exemptions will be considered for generic medicines in deficit is unclear.
This announcement follows an earlier Trump threat To impose a rate of 25% on medicines imported from other countries. He thinks that the rates will lead to overseas manufacturers moving production to the US if this strategy works, it can help rebuild an industrial basis that was largely collected 30 years ago. But if it fails, drug costs will rise, deficits will become more serious and Americans will continue to use medicines of much more Variable quality Then they realize.
Drug rates are a gamble with high bets
About 9 in 10 recipes filled in the US are for generic medicines. Almost half is manufactured in India, according to For IQVA, a supplier of analyzes and clinical research services on the Life Sciences industry. Currently, India pays almost nothing to export the generic medicines to the US, it imposes an import tax of around 10% of medicines produced in the United States.
What do the drugs -execs of India think?
If Trump’s goal is to call alarm bells in India, it doesn’t work – at least not yet. During the Global Pharmaceutical Quality Summit from last month in Mumbai, Reuters quoted Comments made by the heads of some of the largest pharmaceutical companies in India.
Cipla CEO Umang Vohra said: “I am not sure if the rates should dictate what we should do as players, because there is a risk that four years later those rates can disappear. So by the time you build a plant, his rates left. Now you have a plant that sits there, so I just think we have to take a more holistic look.”
“I don’t know how much difference it will make for us,” said Dilip Shanghvi, the director of Sun Pharma, adding that it will “not justify our production … ultimately, ultimately, [the cost of tariffs]
will be passed on to consumers. ‘
The director of Dr. Reddy, GV Prasad, claimed that even if Trump has a big duty on Indian Pharmaceuticals, they can remain competitive. He added that moving production to the US is not practical because American plants do not have enough capacity and “costs would rise.”
Answers if they suggest that India will not be influenced by higher rates. Their production costs are so low and their market share is so high that they are convinced that they can compete with other manufacturers of generic medicines. Ultimately, US patients will pay the price.
In 2023, the pharmaceutical industry of India was the world’s third largest volume. Tehatta, West … [+]
The economy of generic drug production
The reason that the drug prices of India are so low is that their labor and production costs are a fraction of those in the United States. American manufacturers are subject to stricter FDA supervision than their foreign competitors. In the US, for example, an FDA inspector can show up at any time for a non -purchased factory inspection. In India and China, the FDA must provide a prior notice.
Despite these differences, bulk buyers of generic medicines, the American doctors and health systems they supply and the patients who ultimately accept these medicines assume that all generic medicines approved by the FDA are equally safe, regardless of where they were made. The FDAs Office of Generic Drugs website claims that “the FDA approved generic drugs have the same high quality, strength, purity and stability as brand name medicines.” Based on this certainty, generic drug groups and other intermediaries sand the whole world for the cheapest price. They often find it in India.
In the light of these considerations, it is possible, if not likely, that India will continue to dominate the American market despite the rates imposed by Trump.
Generic medicines are a bargain. Are they equally safe?
The FDA’s confidence in the quality of the generic drug supply of America is contradicted by his enforcement actions. For example:
Cipla received an FDA warning letter in November 2023 after thousands of complaints about defective products, according to at the Pharmaceutical times. The letter also emphasized various violations of the current regulations for good production practice (CGMP) that were found during an inspection of a Cipla facility in Indore, Madhya Pradesh.
Last year Sun Pharmaceuticals received an FDA warning This mentioned various violations of Good Manufacturing Practices (GMPs) in one of the facilities in India. The letter also mentioned the company for the insufficient examination of batch errors and serious cleaning falls. It followed earlier FDA warning letters and a consent decision with regard to similar issues.
Dr. Reddy has had similar challenges. In 2024 it remembered more than 330,000 bottles of tablets that were used to treat hyperparathyroidism due to the presence of a well -known carcinogen. In addition, China removed the company from his Bulk-Buy Drug Purchasing Program after an inspection by the National Medical Products Administration of the country had found “Serious defects” in the production activities, according to Farma.
The approach of the FDA of drug safety is no longer sufficient
India is not the only supplier of generic medicines with quality problems. China, that too has quality problemsBlocked FDA inspections at the location in the COVID-19 Pandemie. After that, it established a radical espionage law that can be used to focus on foreign inspectors traveling there. Allegedly, the counterparts of the FDA in Germany no longer want to travel to China because of fear of being arrested.
At the moment it should be clear to everyone, including President Trump and Dr. Marty Makaryhis nominee to lead the FDA, that the dependence on the agency on incidental factory inspections and paperwork reviews Is no longer equal to the task.
Independent tests can strengthen the American hand
Instead of imposing rates that could raise prices at home and aggravate the shortages of drugs, there is an alternative approach that can consider Trump and Makary to love independent, private sector tests of generic medicines to follow the product quality and safety of the product.
This is how it could work: large retail pharmacies (online and retail), healthcare systems and even government governments can conclude a contract with independent ISO-certified laboratories to test samples From different generic medicines from manufacturers. Kaiser Permanent already requires potential sellers of selected generic medicines to provide a product quality certificate from an independent KP’s choice before they make their bid. Our military health system is conducting an exploratory study to assess the quality and safety of its essential generic medicines.
A medicine Quality Score system This combines test data with previous regulatory actions already exists. It could be used to distinguish conscientious manufacturers from those who cut the corners. The FDA could use this data to prioritize which plants to inspect and, if subdivided, take enforcement measures.
Testing generic medicines can achieve three objectives
First, it would inform both foreign and domestic generic drug manufacturers that the initial FDA approval of their products is not a blank check. If they send sloppy products, they will be discovered and the market will respond.
Secondly, American doctors, patients and healthcare systems can use test data to find their medicines from reliable suppliers. This should reduce the failures of treatment, reduce the drug deficits and reduce overall healthcare expenses.
Thirdly, information about quality may lead to the wholesalers of drugs leading them to switch from searching to the lowest price to identifying the best value. It happens, American generic drug manufacturers can compete and win. This Resuction Supply Chains would be reliable, resilient and safe.
America has long tested food, cars, clothing and electronics on quality and safety. As a result, many consumers consult product reviews before they decide to buy which brand. We could use the same approach to evaluate and control the quality and safety of the generic medicines of America, wherever they are. In comparison with drug rates, it is the safer and healthier choice.