As tensions between India and China escalate, the trade relationship between both the countries is also likely to get strained. The Indian pharma industry, which is considerably dependent on China for the import of active pharmaceutical ingredients (APIs), may get adversely impacted. Though the Indian government is initiating certain steps to reduce the industry’s dependency such as setting up bulk drug parks and production linked incentive (PLI) schemes, the outcome of these measures will not be clear for at least two to three years.
Moreover, as a result of the coronavirus pandemic and the subsequent nationwide lockdown, the industry witnessed a significant rise in API prices from January 2020 to April 2020. For instance, the prices of per kg of azithromycin, hydroxychloroquine (HCQ) and Oseltamivir increased from Rs 7200 to Rs 16,000; Rs 7800 to Rs 75,000; and Rs1,00,000 to Rs.1,70,000, respectively.
Therefore, industry stakeholders, share their views on the short term measures needed to tackle the situation until the long term plans start delivering the desired results.
Harish Jain, Secretary, Karnataka Drugs and Pharmaceutical Manufacturers Association said, “Any escalation in tension with China leads to an immediate fall out on the API front. API availability is of strategic importance to us, not only for exports but also for the health and well-being of the 135-crore population of India. We cannot have a nearly $40 billion industry dependent on the import of APIs and KSMs from a hostile country.”
He continued, “It is time to develop a multi-pronged strategy quickly. It is to the credit of the present government, that it has imparted the due importance to this issue. But we need to work on a war footing. On a short term, we need to improve the capacities of existing domestic players and also develop alternate vendors globally who can compete with China. Our long term solution lies in end-to-end manufacturing within the country by using the best of technologies and processes. Pharma parks, ease of doing business, targeted incentives are the need of the hour. It has been said since long that it takes about three years for project implementation. The key is to start quickly so that in three years we are there, otherwise, we will spend the next three years only discussing.”
Dr Rajesh Gupta, All India Head, Laghu Udyog Bharati – Pharma Wing and President of Himachal Drug Manufacturers Association stated, “On September 25, 2018, during an Indian Drug Advisory Forum meeting, we had submitted our proposal about forming the API Monitoring Cell to curb malicious activities in APIs and excipients business, to decision making officials from government bodies along with representatives of pharma associations. At that time the authorities agreed with our proposal but till now they have not finalised the committee members or formed a formal body. However, assessing the market situation and the need for the API monitoring cell, in Jan 2020, we again discussed this with Dr PD Vaghela, Secretary, Department of Pharmaceuticals, along with key representatives from the NPPA. Dr Vaghela had assured us that the government is thinking of making the API monitoring body.”
Pointing out the relevance for an API Monitoring cell in the current situation, he said, “Understanding the tensed border situation between India and China, some of the traders from India have already increased the prices of key APIs. For instance, prices of some key APIs, from the pre-COVID-19 times to the current times i.e. during COVID-19, jumped between 20 -700 per cent. The government can examine the prices to ascertain the facts. If this continues in the future too, then it is likely to see its impact on finished formulations as well. However, if we had the API monitoring cell in place, then the authority could have assessed the capabilities of manufacturing APIs in the domestic market and the total need for API imports from China. It could have also prevented black marketing of APIs in such a critical situation.” He added, “If we make the monitoring cell then all the import items and genuine buying from China can be monitored.”
BR Sikri, Chairman FOPE, and Vice President. BDMA commented, “Every problem has a solution and our Government is competent and capable enough to resolve any issues. If such a situation arises wherein China slows down dispatches or discontinues supplies, the Government of India has to ...
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