What's Now Final — From the April Proclamation to the September BIS Guidance
As of today, September 29, US Section 232 tariffs on pharmaceuticals apply to small and mid-sized exporters too. Here is how the past six months unfolded.
Early April 2026 announcement: Patented drugs and their ingredients face tariffs of up to 100% in principle, with a 15% cap for trade-deal partners including Korea, the EU and Japan.Generics and biosimilars, along with their ingredients, are excluded from the tariffs for now, and the Secretary of Commerce must report to the President within one year of the proclamation (by April 2027) on whether action is needed. This is a provisional exclusion subject to review, not a fixed one-year deferral.Timing: Certain large companies have been covered since July 31. Everyone else is covered from September 29, 180 days after the announcement, so for SMEs and mid-sized exporters the tariffs apply from this week.BIS guidance: On September 23 (US time), the Commerce Department's Bureau of Industry and Security published implementing guidance for Presidential Proclamation 11020 in the Federal Register. It lists Korea among 19 "zero-tariff eligible jurisdictions," alongside the EU, Japan, the UK, Switzerland, India and Taiwan.Which Products Qualify for 0%, and the Practical Test
Being an eligible jurisdiction does not make every product duty-free. The 0% rate covers only these categories:
Drugs whose approved indications are all rare diseasesRadiopharmaceuticals, plasma-derived products and fertility treatmentsCell and gene therapies and antibody-drug conjugates (ADCs)CBRN medical countermeasures and veterinary medicinesThe Orphan Drug Trap: "All Indications"
Having a single rare-disease indication may not be enough. The test covers all approved indications, so expanding into a common disease could change how the product is classified. When you plan an indication expansion, weigh the tariff impact next to pricing and market size.
Where 15% Still Applies
Patented prescription drugs and their ingredients outside the eligible categories stay at 15%. Reclassify your US export portfolio category by category. News reports describe the rules in slightly different ways, so check the final wording against the Federal Register text and the HTS classification used at customs.
Five Things Bio SME Exporters Should Check Now
Build a product-level tariff map: Separate finished products, APIs and intermediates (ADC linkers and payloads, CGT starting materials and so on), and confirm the rate for each. A finished product in a 0% category does not guarantee the same treatment for its intermediates.Plan scenarios for generics and biosimilars: Get ready for the review the Secretary of Commerce must report on by April 2027. Prepare pricing and contract terms for both a 0% and a 15% outcome.Update contracts and origin documents: Review the Incoterms and duty-allocation clauses with US partners and distributors, and put your certificate-of-origin paperwork in order.Use the CDMO opening: Sponsors now have a reason to prefer manufacturing in eligible jurisdictions. This overlaps with demand to replace Chinese suppliers under the BIOSECURE Act, so it is worth stating "eligible-jurisdiction manufacturing" explicitly in your proposals.Compare restructuring costs: For products still facing 15%, compare that duty against the cost of US manufacturing or out-licensing.Connecting to Government Support
Trade support channels: Tariff-response export vouchers, trade insurance and KOTRA trade advisory services can lower the cost of classification advice and contract renegotiation.Pair with regulatory programs: Combining these with global regulatory support programs such as K-VIP lets you design your FDA approval strategy and tariff strategy together. Check the current year's program notice for eligibility and deadlines.Prepare with KITIM
The Korea Institute of Technology Innovation Management (KITIM) supports tariff classification reviews for US-bound products, combined analysis of indication and formulation strategy alongside tariff exposure, and applications for export voucher and regulatory support programs. If you need to know how today's tariffs affect your products, request a consultation through the KITIM contact page. Our consultants will work with you on a product-by-product checklist and a response plan.
