On July 30, 2026, the US Customs and Border Protection (“CBP”) issued implementation guidance for Section 232 tariffs on imports of patented pharmaceutical products and pharmaceutical ingredients, providing importers with reporting and classification instructions ahead of the tariffs’ effective dates. The guidance implements Presidential Proclamation 11020, issued on April 2, 2026, which imposes additional duties on certain patented pharmaceuticals and related active pharmaceutical ingredients and key starting materials. Generic pharmaceuticals and their associated ingredients remain excluded from the measure. Please see our previous blog post on this development here.
The new tariff regime takes effect in stages. For products manufactured by specific companies identified in Annex III of the proclamation, the additional duties became effective on July 31, 2026. For products of all other companies, the tariffs are scheduled to take effect on September 29, 2026. Effective July 31, 2026, all importers of covered pharmaceutical products classified under designated HTSUS provisions in Chapters 29 and 30 must report the appropriate Chapter 99 tariff classification, regardless of whether duties are immediately payable.
CBP’s guidance establishes several tiers. The default Section 232 duty rate for covered patented pharmaceutical articles is 100% ad valorem. Reduced rates apply in certain circumstances, including a 15% duty rate for products originating in the European Union, Japan, South Korea, Switzerland, and Liechtenstein, and a 10% duty rate for products originating in the United Kingdom. The guidance also provides special classifications for products covered by onshoring commitments, specified public-interest pharmaceuticals, generic drugs, and certain US-origin pharmaceutical products. Where multiple tariff rates could apply, the lowest available rate will govern.
The CBP guidance states that no companies currently qualify for the reduced 20% tariff rate available for importers with approved onshoring plans. At the same time, several companies previously identified in Annex II to the proclamation may continue to benefit from a temporary 0% duty rate tied to qualifying onshoring and most-favored-nation pharmaceutical pricing agreements. The guidance also confirms that drawback will be available for duties paid under the proclamation.
The guidance highlights the substantial compliance obligations facing pharmaceutical manufacturers, importers, and supply-chain stakeholders. Companies importing patented pharmaceuticals should review product classifications, assess eligibility for reduced duty treatment, and ensure that entry procedures are updated to reflect the new Chapter 99 reporting requirements. As CBP begins enforcement and additional companies become subject to the tariffs on subject imports beginning late September, careful tariff planning and classification analysis will be essential to managing potential cost increases and compliance risks.
