Measures must focus on domestic players -Madan Mohan Reddy
The pharma sector in India depends heavily on large-scale imports of Active Pharmaceutical ingredients/intermediate products /basic raw materials from overseas countries for making drugs. The prominent reason for the import of API and others from overseas is certainly business economics. Of the suggested steps, the Central Government has already announced certain steps to start inspection mechanism and facilities outside India to ensure that only quality APIs are imported. NITI Ayog is also taking several measures as part of Make in India campaign to plan for more API production in India. Though the intent is there, it is equally essential to initiate solid measures in this direction.
India has proven capabilities in the generic drug formulations, but over dependence on a few overseas countries for sourcing raw materials/intermediate products and APIs does not augur well for the Indian pharma sector, as any interruption in supply can badly impact the sector and jeopardise the health of millions of people across the world. The practical measures in this direction can be envisaged as a multi-pronged approach towards self-reliant India in terms of manufacturing.
India has a competitive advantage of having a deep and broad scientific knowledge coupled with demographic dividend. This can be better deployed to counter the challenges of scale and cost advantages of other countries in the following manner:
To begin with, there should be import-friendly industry policies to register raw materials/intermediate/API facilities in India. This not only multiplies the production volume, but makes it more affordable to the Indian pharma manufacturers as economies of scale accrue to them as well. This, coupled with special incentives for certain families of APIs, can boost up the required momentum of bulk drug manufacturing within India.
Both central and state governments support pharma companies to develop infrastructure and technology trasfer mechanisms, in colloboration with premier engineering and technology institutions. Support to local manufacturers by issuing licenses on minimum stipulated criteria to keep the competition at level playing field. The government can also improve monitoring the demand situation both from the fresh license issuance perspective, apart from controlling the prices. This will establish desi-level playing situation for companies to operate and thrive.
Rationalise and streamline environmental clearance, taking into account the twin objective of creating a permissive climate for operations to commence and continue, apart from preserving environmental standards Finally, the government in consultation with professional agencies like Pharmexcil, BDMA, IDMA, CII, etc, to create bulk drug hub linking API value chain such as RM, intermediates and finished bulk drugs with latest technology which act as a catalyst not only to the existing manufacturers for bottlenecking services, but also to the new startup entrpreneurs on the look out for a great opportunity in this arena.
Some of the countries have excelled in bulk drug manufacturing as they have huge trade barriers for export of medicines and APIs. According to industry experts, if India doesn’t put in place similar stringent policy and trade barriers, despite having world-class assets and knolwedge resource base, overseas suppliers would dictate price in the future, which will pose a threat to Indian players.
To succinctly put in, short-term measures must focus on domestic players in terms of financial, technology and compliances partnerships. Long-term measures must focus on policy changes by various ministries and administration, in collaboration with professional organisations in the country towards this end.