Generic drugmaker Hikma pledges $1bn in US investment

Faced with the prospect of tariffs on imported medicines threatened by the Trump administration, Indian drugmaker Hikma has said it will spend $1 billion to expand its manufacturing and R&D operations in the US by 2030.

The announcement comes as the pharma sector is still waiting for news on the potential sector-specific tariffs, which Trump has said are necessary to bring manufacturing back into the US and make sure medicines intended for use by Americans are made domestically.

Hikma's announcement ties into that sentiment, coming with the strap line: "America Leans on Hikma: Quality Medicines Manufactured in the USA," and points to its investment of $4 billion over the last 15 years in US-based facilities and a 34-year heritage in supplying the US market.

"Over this period, Hikma has provided patients with access to a wide range of generic medicines at a lower cost than branded products," it said in a statement. "The company has an excellent record of US FDA quality inspections and has a successful record of working with FDA to solve critical drug shortages."

At the moment, pharma is exempted from Trump's tariffs, although, the US President repeated just a few days ago that they are coming "very soon".

The prospect has sparked concerns that pharma tariffs will lead to escalating medicine prices in the US, which will be borne by patients, and that some low-volume drugs may become unavailable if overseas producers decide it is no longer economically viable to supply the US market.

At the moment, almost a third of medicines used in the US are imported – roughly $200 billion out of $560 billion consumed in 2024 – and India is a key source of generic medicines.

In April, the administration started a so-called Section 232 investigation into the pharma sector, which has the objective of determining the effect of medicine imports on the national security of the US and could be used to justify the imposition of tariffs or other trade restrictions.

At the moment, most tariffs on US imports have been introduced under emergency powers, but 232 probes have been used to justify hefty levies on steel and aluminium, as well as automotive imports.

Hikma's move is remarkable as it represents one of the first pledges by an Indian company to a big US investment programme, although, several other large pharma groups from the US and Europe have already unveiled their own commitments.

The company said the investment will be spent at its R&D and manufacturing sites in Columbus and Cleveland, Ohio, and in Cherry Hill and Dayton, New Jersey, and would increase its US-based capacity to produce "large volumes of […] affordable medicines."

Dr Bill Larkins, president of Hikma Injectables, said: "Over the past 15 years, Hikma has grown to become a top three US supplier of sterile injectable medicines with more than 180 injectable products in our portfolio and a growing pipeline. This new phase of US investment will enhance and expand our sterile injectables production capabilities and enable us to continue providing our broad portfolio of essential medicines to US patients."

The plan was unveiled at a groundbreaking event held at Hikma's manufacturing and R&D facility in Columbus.