Japan Generics to Have Zero Percent Tariffs in U.S.

Under a new trade deal, the U.S. government is bringing down tariffs on generic drugs from Japan to zero percent. As per the executive order signed by President Donald Trump on September 4, 2025, the new reciprocal tariff frame work exempts certain key sectors from the 15% tariffs. The generic pharmaceuticals, pharmaceutical ingredients and precursors from Japan will now attract 0% reciprocal tariffs. In exchange for this favorable trade treatment, the Japanese government has agreed to a $550 billion investment into the U.S.

The US has earlier finalised a similar deal for the European Union (EU) which also set “effectively zero” tariffs on pharmaceutical generics. India, often referred to as the “pharmacy of the world” and a major exporter of cost-effective generics to the U.S., currently also enjoys a zero percent tariff on its finished generic formulations. However the threat of higher tariffs remains, as the Trump administration has consistently floated the possibility of imposing significant tariffs on pharmaceutical imports from all countries to promote domestic manufacturing.

Reference: Executive Order – September 4,2025, Implementing The United States–Japan Agreement