In the battle of wills between the world’s oldest and biggest democracies, lie the seeds of change. With the 25 per cent reciprocal tariffs joined by 25 per cent penalty tariffs, India has to find a way to survive 50 per cent tariffs which came into effect on August 27, 2025. All sectors are adapting to this change, and India’s biopharma leaders are already building a new playbook. Turning a challenge into an opportunity, they are pivoting to other markets like the EU, Africa and other geographies with new purpose and aggression.
For example, Aurobindo Pharma is reportedly the front runner in a race to acquire Zentiva, which would give it an enviable expanded footprint in the EU. In an interview to CNBC-TV18, Aurobindo CFO, Santhanam Subramanian explained that Zentiva fits into their strategic plans as it is based in Europe, but it was too premature to comment on possible outcome of ongoing discussions. He also commented that there was nothing wrong in looking at acquiring a large entity. This reasoning hints at the strategic reset underway in India’s pharma boardrooms and sets the stage for more such moves.
But these decoupling/derisking strategies take time to fructify. In the near term, pharma companies remain vulnerable to news out of the US. Pharma shares took a beating on the day the additional 25 per cent tariffs set in, even though pharma imports remain exempted.
President Trump’s diktat to pharma companies to slash prices on their own, and threats to “slash drug prices by as much as 1,400–1,500%” and impose higher levies on pharma imports, remains a hanging sword.
And let’s not forget that there are slew of non-tariff barriers that could be deployed like increasing US FDA scrutiny etc. The tariffs could also derail India’s plans to position itself as a key part of the China+1 strategy, as it makes other nations with lower tariffs more competitive.
India pharma might have to brace for a slow down on global FDI, and will find it harder to position itself. This could well be the right storm in the teacup moment to rediscover and reinvent India Pharma Inc from a volume to value play, moving from manufacturing to R&D services.
In fact, one of the trends highlighted in an April 2025 CBRE report, Global Life Sciences Atlas, is how pharma and biotech companies are on the lookout for high-quality lab clusters to support global collaboration, as they accelerate their R&D programmes.
As per the report, gross office leasing space by life sciences firms in India increased by ~56% Y-o-Y to about 5.8 million sq. ft., witnessing the highest-ever leasing activity by the sector. While China currently exhibits the highest volume of ongoing laboratory construction worldwide, India is establishing itself as a hub for life sciences manufacturing.
Hyderabad’s Genome Valley is already home to over 200 biotech and pharma companies from 18 countries, including six of the world’s top 10 research and development (R&D) companies . More than 20 life sciences and medical technology incubators are in Hyderabad, the highest concentration in India.
There is no doubt that India has a long way to go but the trends look promising. The CBRE report benchmarks emerging hubs like Hyderabad in the AsiaPacific region (Beijing, Shanghai, Greater Tokyo), as well as the traditional hubs in Canada (Toronto, Montreal) and Europe (Cambridge, U.K., Paris) and Boston-Cambridge and the San Francisco Bay Area in the US. This benchmarking exercise also serves to show where the gaps are and how they can be plugged. India needs more Genome Valley-like clusters to make a true impact.
India’s domestic market, thanks to demographics, remains attractive and we could see more investments here. Prime Minister’s GST reforms and other policy easing are designed to soothe some of the tariff constraints. This spur for long overdue reforms might just turn out to be the silver lining in the tariff clouds.
Demographics is one major reason why India stands a good chance of weathering the ‘who will blink first’ tariff tiff. The sheer size of India’s market remains a major draw. For instance, India’s domestic market is already witnessing the battle of the weight loss majors Novo Nordisk and Eli Lilly. They will be joined next year by at least six of India’s major companies when Novo Nordisk’s semaglutide faces patent expiry.
As per a Reuters report, Novo Nordisk is already facing slowing global sales of Wegovy due to competition, leading to possible layoffs. Other Reuters reports detail the numerous lawsuits filed by Novo Nordisk against compounding pharmacies in the US for spinning off un-authorised Wegovy copies. Simultaneously, patients in the US are suing Novo Nordisk for not informing them and not creating enough awareness on serious side effects ranging from gastrointestinal issues, pancreatitis and vision loss.
Both Eli Lilly and Novo Nordisk, along with other global majors, have oral weight loss drug candidates making their way through clinical trials. In a country with India’s climate and economic constraints, weight loss pills would make more sense than shots.
As tariffs wars play out, India’s pharma sector forges its way ahead. India’s patients and doctor communities too need to weigh the pros and cons of weight loss medications, as well as other launches, to safeguard their long term health.
VIVEKA ROYCHOWDHURY, Editor
viveka.r@expressindia.com
viveka.roy3@gmail.com