Pharma stocks: Sun Pharma, Dr Reddy’s, Cipla, Biocon and others in focus today; here's why 

Pharma sector stocks such as Sun Pharma, Dr Reddy’s, Cipla, Biocon, Shilpa Medicare, Zydus Life and Hester Bio are in focus today after the US exempted select specialty drugs from India from ad-valorem tariff. India is among 20 countries getting 0% tariff on certain specialty drugs and ingredients, including rare-disease, infertility, cell/gene therapies, ADCs and animal pharmaceuticals.

However, the exemption is product-specific and does not imply a blanket tariff exemption.

But the relief is significant for the pharma sector in the stock market. It is the only sector that has been resilient in the recent fall and has clearly outperformed in last one year.

While Sensex has lost 13%, Nifty pharma index has gained 18% this year.

In FY26, India’s total pharma exports rose to $31.1 billion. Of these, exports to the US stood at $9.47 billion. US share of India’s pharma exports stand at 30.4%.

Firms such as Sun Pharma, Dr Reddy’s and Cipla are engaged in the production and sale of rare disease & specialty therapies. Sun Pharma and Cipla sell infertility treatments drugs. Biocon and Cipla are involved in drugs for cell & gene therapies. Zydus Life and Hester Bio deal in animal pharmaceuticals.

ALSO READ: Dr. Reddy’s, Lupin shares among buzzing stocks as pharma sector back in focus

Which drugs are covered?

The US Commerce Department’s notice provides a zero-tariff exemption for a select group of specialised pharmaceutical and medical products. The list includes medicines used to treat rare diseases and infertility, as well as cell and gene therapies, antibody-drug conjugates and veterinary pharmaceuticals.

The exemption also extends to components used in the manufacture of these products. However, the measure is narrowly focused on speciality medicines and does not apply to the pharmaceutical sector as a whole.

Eligible products include medicines for which all approved indications relate to orphan or rare diseases. The zero-tariff category also covers nuclear medicines, plasma-derived therapies and fertility treatments.

Certain medical countermeasures designed to address chemical, biological, radiological and nuclear threats are also included in the exemption.

India among 20 eligible jurisdictions

India is among 20 countries and jurisdictions whose qualifying pharmaceutical products can benefit from the zero-tariff treatment. The list also includes Argentina, Bangladesh, Cambodia, Ecuador, El Salvador, the European Union, Guatemala, Indonesia, Japan, Jordan, Malaysia, North Macedonia, South Korea, Switzerland, Liechtenstein, Taiwan, Thailand, the UK and Vietnam.

According to the notice, qualifying products originating from these jurisdictions may receive a zero per cent tariff because the countries have existing or forthcoming trade and security framework agreements with the US.

The Commerce Department’s Bureau of Industry and Security has also retained the flexibility to extend the exemption to products that it determines are necessary to address an urgent healthcare need in the US.