India-EU trade deal likely to help GLP-1 therapies become cheaper

India-EU FTA to lower tariffs on pharma, potentially making GLP-1 therapies like semaglutide cheaper and boosting adoption among diabetics in India

Multinational pharmaceutical players like Danish major Novo Nordisk stand to gain from India’s free-trade agreement (FTA) with the European Union (EU) because prices of their specialty drugs and biologics, especially in fast-growing therapies like glucagon-like peptide-1 (GLP-1), which is for weight loss and diabetes, are set to come down.

 

Under the new framework, the EU will cut duties of up to 12.8 per cent to zero, a move expected to catalyse growth in bulk and specialty chemicals.

 

Similarly, 90 per cent of medical and surgical equipment will see tariffs fall from 27.5 per cent to zero.

 

Reciprocally, Indian tariffs on pharmaceutical and chemical exports from Europe will drop to zero from the current 11 per cent and 22 per cent, respectively.

 

Novo Nordisk imports the bulk drug of its semaglutide (GLP-1 drug) from the EU, and that will now become cheaper. Novo Nordisk India did not wish to comment because it is waiting for clarity on the fine print of the agreement and the parent company is in the silent period, which comes before the quarterly results.

 

Novo Nordisk has a tieup with Emcure, which exclusively distributes Poviztra (semaglutide), priced at ₹8,790 per month (four weekly doses) for the starter dose. This is about 19 per cent lower than Wegovy’s current 0.25 mg price of ₹10,850.

 

As the patent for this drug expires around March, a potential generic market of ₹1,000 crore-2,000 crore in the branded-formulation space is likely to open up in India.

 

India may see a sharp rise in the adoption of GLP-1 therapy among diabetics, driven by an affordable price, potentially 30-50 per cent lower versus the current level.

 

Vishal Manchanda, pharma analyst, Systematix group, said in a recent report that this opportunity was likely to be shared among 10-15 players, comprising Indian and global generic manufacturers. 

 

“Indian players that stand to benefit the most are Sun Pharma, Dr Reddy’s, Eris Lifesciences, Cipla, One Source Speciality Pharma, Torrent Pharma, Lupin, Alkem, Zydus Lifesciences, Ajanta Pharma, and Biocon,” he added.

 

“Over time prices could further correct 70-75 per cent,” Manchanda said.

 

Parag Bhatia, director, Laborate Pharmaceuticals, said: “GLP-1 therapies sit at the intersection of complex manufacturing, global supply chains, and tight regulatory oversight. While the FTA is unlikely to trigger immediate price reductions for GLP-1 drugs, it can influence pricing over the medium term by improving predictability in regulatory pathways, sourcing, and cross-border collaboration.”

 

The real cost drivers for GLP-1 therapies remain high-value active pharmaceutical ingredients (APIs), cold-chain requirements, specialised fill-finish capabilities, and stringent quality controls. Over time, smoother trade frameworks and a better regulatory alignment with the EU could help Indian manufacturers optimise supply chains, reduce frictional costs, and scale up efficiently. Any meaningful price impact, however, depends on sustained investment in manufacturing discipline, quality systems, and capacity rather than tariff relief alone, he added.  

 

Ashok Nair, managing director, RPG Life Sciences, said the removal of the 11 per cent tariff on pharmaceutical products under the FTA was expected to have a meaningful impact on API pricing dynamics.

 

“We don’t expect a blanket price drop on every API. Many pharma products had low or zero EU tariffs under the World Trade Organization ‘zero for zero’ framework. So, the big driver of price remains quality, reliability, and compliance, not just Customs duty,” Nair added.