The government has announced guidelines for the development of bulk drug and medical device parks in a bid to promote indigenous manufacturing of these products.
DV Sadananda Gowda, Union Minister for Chemicals and Fertilisers, launched the schemes and guidelines of Department of Pharmaceuticals. Mansukh Laxmanbhai Mandaviya, MoS(i/c) for Shipping and MoS for Chemicals & Fertilisers; Amitabh Kant, CEO Niti Ayog and Dr P D Waghela, Secretary, Department of Pharmaceuticals were also present at the launch.
Speaking on the occasion, Gowda said that this in line with the vision of Prime Minister Narendra Modi, and his clarion call for making India ‘aatma nirbhar’ in the pharma sector. For this, the Government of India has approved four schemes, two each for bulk drugs and medical devices parks. He exhorted the industry and the States to come forward and participate in these schemes.
Mandavia said that this is a very important initiative towards further developing Indian pharmaceutical capacities. Giving details of the guidelines, he said that the Production Linked Incentive (PLI) schemes for promoting domestic manufacturing of KSMs, DIs and APIs and medical devices will go a long way including to boost domestic manufacturing of 53 bulk drugs, on which India is critically dependent on imports.
The list of 41 products contained in the scheme guidelines will enable domestic production of 53 bulk drugs. Financial incentives will be given to a maximum of 136 manufacturers selected under the scheme as a fixed percentage of their domestic sales of these 41 products manufactured locally with the required level of domestic value addition.
The incentives would be subject to annual ceilings communicated in the approval letter. The incentives would be given for a period of six years. In case of fermentation-based products, the rate of incentive is 20 per cent for the first four years, 15 per cent for the fifth year and five per cent for the sixth year.
In the case of chemically synthesised products, the rate of incentive is 10 per cent for all six years. The selected manufacturers shall have to complete committed investment above a threshold investment mandated for each product and achieve a prescribed minimum installed capacity before they are eligible to receive incentives. Threshold investment is Rs 400 crore for four fermentation-based products and Rs 50 crore for ten fermentation-based products. Similarly, threshold investment is Rs 50 crore for four chemically synthesised products, and Rs 20 crore for 23 chemically synthesised products. Minimum installed capacity to be achieved for each of the 41 products is prescribed in the guidelines. The incentives for fermentation-based products would be available from FY 2023-24 i.e. after a two year gestation period during which the selected applicant has to complete the committed investment and install the committed capacity.
For chemically synthesised products the incentives would be available from FY 2022-23 i.e. after a gestation period of one year during which the selected applicant has to make the committed investment and install the committed capacity. Any company, partnership firm, proprietorship firm or an LLP registered in India and possessing a minimum net worth (including group companies) of 30 per cent of the proposed investment is eligible to apply for incentives under the scheme. An applicant can apply for any number of products.
The applicants will be selected on the basis of evaluation criteria which include the annual production capacity committed by the applicant and the sale price of the product quoted by the applicant. Applicants quoting low sale price and higher production capacity will get higher marks in the evaluation.
The guidelines are available on the website of the Department of Pharmaceuticals.
Salient features of the schemes are:
The scheme is open for applications for a period of 120 days from the date of issuance of guidelines and the approval will be given to the selected applicants within 90 days from the closure of application window. Applications will be received only through an online portal. The total financial outlay of the scheme is Rs. 6,940 crores.
Scheme for promotion of bulk drug ...
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