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What is the story about?
Shares of India's largest drug manufacturer, Sun Pharma Ltd. will be in focus on Friday, September 26, after US President Donald Trump announced that there will be a 100% tariff on branded and patented drugs being imported in to the US, starting October 1.
The tariffs will not be applicable to those companies that have plants in the US, are building plants in the US, or have broken ground for building plants in the US.
Sun Pharma has key specialty products like Illumya, Cequa, Odomozo, and Winlevi and the entire business comprises of 19.3% of its overall sales.
In financial year 2025, Sun Pharma's specialty sales increased by 17% from last year to $1.2 billion, while global Illumya sales grew by 17% to $681 million.
However, the company does not disclose sales from the US plants. The management has earlier indicated that the current capacity is good enough in case they need to undertake onshore manufacturing, without adding new capacity.
In an interaction with CNBC-TV18 on Friday, Aditya Khemka of InCred Asset Management said that a possibility of tariffs being imposed on Pharma generics cannot be ruled out.
“Pharmaceuticals, such as prescription drugs, over-the-counter drugs, biologics, and specialty drugs, will not be covered under this investigation as those imports are being examined in a separate Section 232 investigation,” the US Commerce Department said.
Khemka said that he sees some impact on Sun Pharma and Wockhardt due to US tariffs on branded Pharma products, which could potentially have some biosimilars as well, and in that case, Biocon could also end up being at risk.
"Will not touch the Pharma business as an investor as clarity emerges on tariffs," Khemka said.
The Nifty Pharma index has declined 2% in the last one month with stocks like Divi's, Cipla and Ajanta Pharma declining up to 6%.
Shares of Sun Pharma ended little changed on Thursday at ₹1,625. The stock has gained 1.5% over the last one month.
The tariffs will not be applicable to those companies that have plants in the US, are building plants in the US, or have broken ground for building plants in the US.
Sun Pharma has key specialty products like Illumya, Cequa, Odomozo, and Winlevi and the entire business comprises of 19.3% of its overall sales.
In financial year 2025, Sun Pharma's specialty sales increased by 17% from last year to $1.2 billion, while global Illumya sales grew by 17% to $681 million.
However, the company does not disclose sales from the US plants. The management has earlier indicated that the current capacity is good enough in case they need to undertake onshore manufacturing, without adding new capacity.
In an interaction with CNBC-TV18 on Friday, Aditya Khemka of InCred Asset Management said that a possibility of tariffs being imposed on Pharma generics cannot be ruled out.
“Pharmaceuticals, such as prescription drugs, over-the-counter drugs, biologics, and specialty drugs, will not be covered under this investigation as those imports are being examined in a separate Section 232 investigation,” the US Commerce Department said.
Khemka said that he sees some impact on Sun Pharma and Wockhardt due to US tariffs on branded Pharma products, which could potentially have some biosimilars as well, and in that case, Biocon could also end up being at risk.
"Will not touch the Pharma business as an investor as clarity emerges on tariffs," Khemka said.
The Nifty Pharma index has declined 2% in the last one month with stocks like Divi's, Cipla and Ajanta Pharma declining up to 6%.
Shares of Sun Pharma ended little changed on Thursday at ₹1,625. The stock has gained 1.5% over the last one month.
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