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While continuing rise in prices of active pharmaceutical ingredients from China is wiping out profit margins of Indian drug manufacturers, a high-level task force constituted by the Central government to decide on regulatory interventions to revive the sector is failing to achieve its objectives and has not held even a single meeting with industry stakeholders.
Though the strategic group held its first meeting last month, nearly five months after its formation, under the chairmanship of Minister of State for Chemicals and Fertilisers, Mansukh Mandaviya, it was attended only by senior bureaucrats, say industry sources.
The task force includes secretaries from the departments of pharmaceuticals, the ministries of health, environment, commerce and biotechnology, the Director General of Council of Scientific and Industrial Research, the Drug Controller General of India, representatives of various industry lobby groups and private sector experts.
“We’ve chosen our representative to take part in task force meetings. Hope we will be invited to attend its next session,” Deepnath Roy Chowdhury, president of the Indian Drug Manufacturers Association (IDMA) told Pharmabiz.
The high-powered group was set up by the government amid growing concerns over an overwhelming dependence on Chinese drug imports. India imports about 80 per cent of its APIs, raw materials required for making finished drugs, despite producing a fifth of the world’s generic drugs. Bulk drugs, including essential antibiotics, worth Rs. 13,853 crore were imported from China in 2015-16 or 65.3 per cent of the Rs. 21,217 crore total APIs consumed in the country.
In the past few months, a crackdown by Beijing on polluting industries has raised the prices of imported APIs dramatically. The price of some APIs has gone up by around 40 per cent and drug makers, especially small firms, are struggling to fulfill their contractual obligations, which could soon lead to shortage of certain key drugs in the market.
“We are critically over-dependent on China for APIs and several key-starting-materials. I’ve conveyed my concerns to the government as it is a matter of national health security,” the IDMA president added.
Despite this dire scenario, inaction by the government task force, established to boost the weakened domestic bulk drug production, is causing disappointment among manufacturers. Though the task force is mandated to look into required interventions concerning Central and State governments and various regulatory bodies, no action has been taken in the last five months.
“This is the time to lend a helping hand to domestic API makers for the long term health security of this country. Closure of many Chinese firms is causing shortage of bulk drugs. Regulatory interventions and incentives such as subsidised land and power are imperative,” an industry lobby group representative pointed out.
“The policy on import dependent API and medical devices is long overdue. The DoP needs to play its role assertively and not get swayed by importers’ lobby that has been stalling and blocking any move to curb or substitute imports with domestic manufacturing,” Association of Indian Medical Device Industry Forum coordinator Rajiv Nath said via his Twitter handle.
The domestic drug industry has been pitching for a conducive regulatory environment to fuel growth in the API sector. While China regularly tweaks rules to give a fillip to its industry, India lags behind in this area. Registration and inspection fee for pharma exporters to India still remains extremely low. On the other hand, China charges hefty registration fee and takes many years to grant permission.
“The existing Indian regulations don’t allow a domestic manufacturer to go for capacity expansion or diversification to meet market demand without prior consent from pollution control boards even if there is no change in pollution load. The approval can take up to six months to arrive,” a senior pharmaceutical company executive pointed out.
It may be noted that a Parliamentary Standing Committee on Commerce recently has made a strong case for taking aggressive measures, following the example set by the United States and the European Union, to check import of bulk drugs from China. The committee has also stressed the need for monitoring, surveillance and enforcement of the trade remedies.
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