August 6th, 2026 – U.S. Customs and Border Protection (CBP) has issued implementation guidance for new tariffs on certain patented pharmaceutical products and pharmaceutical ingredients under the April 2nd, 2026, Presidential Proclamation 11020. Importers should review these changes carefully, as new reporting requirements begin immediately and additional duties will be phased in over the coming months.
Key Highlights
New tariff program takes effect July 31, 2026
- Effective July 31st, 2026, importers of products classified under the affected HTSUS Chapters 29 and 30 must report the appropriate Chapter 99 HTSUS classification on all applicable entries.
- This reporting requirement applies regardless of whether additional duties are currently owed.
Additional duties are being phased in
- July 31st, 2026: Additional Section 232 duties begin for patented pharmaceutical products manufactured by companies specifically listed in Annex III of the Presidential Proclamation.
- September 29th, 2026: Additional duties expand to patented pharmaceutical products from all other companies.
Generic pharmaceuticals remain exempt
- Generic pharmaceutical products and their associated ingredients are not subject to the new tariffs, although the appropriate Chapter 99 classification must still be reported.
Duty Rates
The new Chapter 99 classifications establish different duty treatments depending on product type, country of origin, and company status, including:
- 100% duty on certain patented pharmaceutical products.
- 15% duty for qualifying products originating from Japan, European Union member countries, South Korea, Switzerland, and Liechtenstein.
- 10% duty for qualifying products originating from the United Kingdom.
- Several classifications continue to provide 0% additional duty, including:
- Generic pharmaceuticals
- Certain U.S.-origin pharmaceutical products
- Specific qualifying products covered by onshoring or pricing agreements
- Certain pharmaceutical products with U.S.-origin active pharmaceutical ingredients
When more than one tariff rate could apply to a product, the lowest applicable rate will be used.
Additional Considerations
- U.S.-origin pharmaceutical products are not subject to these tariffs.
- Duties apply in addition to any preferential rates available under applicable free trade agreements.
- Drawback remains available for duties paid under this program.
- Products admitted into a Foreign Trade Zone (FTZ) that are subject to these tariffs must generally be entered under Privileged Foreign Status.
- Existing antidumping, countervailing, and other applicable duties continue to apply where relevant.
What Importers Should Do
Importers of pharmaceutical products should review their product classifications, determine which Chapter 99 HTSUS code applies, and verify whether their suppliers are included in Annex III. Ensuring proper classification and reporting will help avoid delays, penalties, and compliance issues as CBP begins enforcing these new requirements.
Read the full CSMS Update Here: CSMS # 69395344
View the full Section 232 HTS List Here: Pharmaceuticals HTS List
