HYDERABAD: The government is looking to promote domestic pharma companies’ tieups with bulk drug makers in Italy to cut dependence on China for pharmaceutical ingredients.
India sources over 70 per cent of its requirement of bulk drugs (ingredients) from Chinese pharmaceutical companies.
A senior commerce ministry official said the government, which will unveil a new bulk drug policy soon, is preparing schemes aimed at wooing Italian drug makers with attractive incentives as a part of its ‘Make in India’ initiative.
“The ministry is asking Italian drug makers to forge alliances with Indian pharmaceutical firms to set up joint ventures in India,” PV Appaji, director general of Pharmaceuticals Export Promotion Council (Pharmexcil), told ET. “The move is primarily aimed at reducing the dependence on China, even while encouraging domestic pharmaceutical firms towards backward integration that ensures greater cost efficiencies and quality control.”
Appaji said the proposed new bulk drugs policy is being given final touches to include attractive incentives to lure global bulk drug manufacturers in general, and Italian firms in particular, given their technological strength in manufacture of crucial bulk drugs for life-saving medicines.
At present, India depends largely on China for common essential bulk drugs such as Paracetamol,Metformin, Pen-G, 6-APA, Aspirin, Erythromycin Thiocinate, Sartans, Ofloxacin, Levofloxacin and Vitamin Cfor intermediates, and Metronidazole, Vitamin C, Ofloxacin and Levofloxacin for active pharmaceutical ingredients (APIs). While India produced about $10 billion worth of APIs last year, its export of APIs remained flat at $3.6 billion. As against this, the subcontinent imports around $3.5 billion worth of APIs every year, mostly from China.
The top 100 Indian medicine manufacturers depend on China for at least half of their API requirement, and at least 150 medicines classified under the National List of Essential Medicines (NLEM) depend on Chinese imported bulk drugs.
Italy is the world’s third largest API producer with about $4 billion and exports more than three fourths of its production, mostly to the US market. Among the prominent Italian API producers are FIS (Fabbrica Italiana sintetici), Angelini Pharmaceuticals and Trifarma.
According to Pharmexcil’s director general, since some Italian firms have shown interest in forging alliances with Indian drugmakers, the commerce ministry plans to hold another dialogue with Italian drug makers in October.
Increased cost of production and other European economy related constraints had led to several local drug makers shutting down their unviable units.
“Technology transfer agreements from Italian drug makers is also being actively pursued,” Appaji said. Jayant Tagore, president of India’s Bulk Drug Manufacturers’ Association (BDMA), said overdependence on a few suppliers for key bulk drugs is turning alarming. The factors working against domestic bulk drug makers include fragmented capacities, high cost of land and power, absence of adequate incentives and reservation of certain products for the small scale industry, he said.