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On May 12, 2025, US President Donald Trump signed an executive order invoking a “Most Favoured Nation” (MFN) pricing policy aimed at drastically reducing drug prices in the US.
Aspect | Details |
Pharma Exports | India exports ~$9 billion worth of generic drugs to the US annually. Price benchmarking could squeeze margins, affecting India’s pharma trade surplus. |
Global Pricing Pressure | Indian firms may be pressured to lower international prices or risk being excluded from US procurement, affecting global competitiveness. |
Domestic Price Hikes | To offset US losses, companies may raise prices in domestic markets, affecting drug affordability in India. |
R&D Investment Impact | Lower profitability may curtail funding for research, innovation, and new drug development, weakening the long-term capabilities of Indian pharma firms. |
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