- The Indian government has decided to reduce the dependence on China for bulk drugs or Active Pharmaceutical Ingredients (APIs)
- Bulk drugs are the raw materials used in the manufacture of medicines
- One of the reasons for imports from China is that they provide bulk drugs at a lower price, but still in good quality, Commerce and Industry Minister Nirmala Sitharaman said
- The Katoch committee report suggests ways to reduce the dependence on bulk drug imports from China
The Indian government has begun to take a number of steps to reduce the dependence on China for bulk drugs or Active Pharmaceutical Ingredients (API), recognizing that the practice may put its drug supply system at substantial risk.
India gets more than 75 percent of its bulk drug from China, particularly for the manufacture of 12 critical medicines including paracetamol and amoxicillin.
The over-dependence on China for bulk drugs raises some concern from authorities who believe any deterioration in association with China could potentially result in severe shortages in supply of essential drugs to the country.
The cost of bulk drugs import from China increased from $2.11 billion in 2013-14 to $2.22 billion in 2014-15 – a rise of $110 million, Commerce and Industry Minister Nirmala Sitharaman in a written reply informed the Parliament last week.
One of the reasons for imports from China is that they provide bulk drugs at a lower price, but still in good quality, Sitharaman said.
As part of the government initiative to expand bulk drug manufacturing facilities in India and reduce the dependence on bulk drug imports from China, the ministry is planning to fund Rs. 200 crore each to three new bulk drug parks for creating manufacturing facilities.
The government had set up a panel overseen by former health secretary V.M Katoch to frame the bulk drug manufacturing policy.
“The committee has since submitted its recommendations. After examining the recommendations, government is now looking into the financial viability of supporting the proposal for providing assistance for common minimum facilities for three greenfield bulk drugs/API parks to the extent of Rs. 200 crore each,” the Minister of state for chemicals and fertilizers, Hansraj Gangaram Ahir said in a written reply to the Rajya Sabha.
Ahir also said that the union ministry is also working closely with the Ministry of commerce and industry and the Ministry of environment, forests and climate change to address the problems faced by bulk drug manufacturers related to environment.
In India, there are over 10,000 medium and small-scale firms and 300 large firms in the bulk drug manufacturing sector. Around 77 percent of them make formulations and 23 percent APIs.
Bulk drug manufacturers have been complaining about the strict environmental clearance norms for a long time. They said that they were facing several environmental clearance hurdles as the country was following age-old rules. They had to get separate clearance certificates for all the drugs from the environment ministry, even if the plant had got a license.
On the other hand, the Central Pollution Control Board (CPCB), which is responsible for maintaining national standards under a variety of environment protection laws in India, alleges that bulk drug manufacturing firms are disregarding the pollution control norms and their units are producing drugs in excess of the permitted numbers. The charges from the CPCB also include that pharmaceutical companies are responsible for the unauthorised manufacture of these drugs which is one of the leading causes of pollution.
However, the government decided to relax some norms on environment clearances related to bulk drug manufacturing to encourage Indian drug makers.
The V.M Katoch committee also suggested setting up of mega parks to produce APIs with standard facilities like testing, power and effluent treatment plants. It has also proposed establishing facilities such as storage, testing laboratories, IPR management, designing and guest house/accommodation managed by a separate special purpose vehicle (SPV).
The committee recommended to the union ministry a package that provides incentives and tax concessions to bulk drug manufacturers in India, so domestic production gets a boost.
The committee called for the revival of public sector units (PSU) to start manufacturing essential critical drugs, like paracetamol and penicillin. Out of the five pharma sector PSUs – Hindustan Antibiotics Ltd (HAL), Bengal Chemicals and Pharmaceuticals Ltd (BCPL) and Indian Drugs and Pharmaceuticals Ltd (IDPL), Karnataka Antibiotics and Pharmaceuticals Ltd (KAPL), Rajasthan Drugs and Pharmaceuticals Ltd (RDPL) – IDPL, HAL and BCPL have been declared sick by the Board for Industrial and Financial Reconstruction (BIFR).
Upgrading Standards and Technology
The government is also taking several initiatives to help pharma companies upgrade technology and promote drug discovery and innovation in the country.
The Department of Pharmaceuticals is preparing a Pharmaceutical Technology Upgradation Assistance Scheme to support small and medium scale pharma industry “to upgrade their regulatory technology compliance from Schedule M of the Dugs and Cosmetics Act, 1940 to WHO-GMP norms by facilitating low interest loans,” Minister of Chemicals and Fertilisers Ananth Kumar said in a reply to the Rajya Sabha.
Compliance with World Health Organization-GMP norms is essential to enter export markets in most countries.
Meanwhile, in a year’s time, the government is also planning to form a separate ministry for pharmaceuticals and medical services. Currently, both of them function under the ministry of chemicals and fertilizers.