The Karnataka Drugs and Pharmaceuticals Manufacturers Association (KDPMA) would soon submit a project report for the much speculated pharmaceutical industry park to the state government. The KDPMA, which is proposing the Pharma Park to be located within 20 km from Bangalore city, would most likely present the project report highlighting the choice of location and the requirement of land etc., within a week.
According to KDPMA sources the State needs to develop basic infrastructure for pharmaceutical industry to attract investments as the pharma sector here has not seen a single investments for the last five years.
“This is mainly because of lack of infrastructure provided by the State government in the industrial areas,” said KDPMA sources. In Karnataka, perhaps the last major pharma investment was almost four years ago when the Banner Pharma set up its facility in 1998.
Talking to www.pharmabiz.com, SP Radhakrishna, technical director, Department of Industry and Commerce, said that the persistent requests from KDPMA to support the industry with basic infrastructure like power, water and effluent treatment plants is expected to be accepted and the government is keen to give a helping hand to the promising sector.
“Once KDPMA submits its project report, the government will make concerted efforts to offer support in terms of infrastructure and the remaining assistance will be chipped by the private sector,” he said.
Despite the friendly-investment policies of the State government, pharma industry in the state has not had any new investments except for expansion plans by the existing units. “There needs to be tax incentives for investors to be lured to Karnataka like for instance Goa where both the Centre and state governments are attracting investments, noted, RS Iyer, pharma consultant and former head of quality control, Glaxo India.
N. Jatish Seth, secretary, KDPMA and director, Srushti Pharmaceuticals said, “We do not want sops but basic infrastructure and clear communication on the information on modified laws as most entrepreneurs are caught unawares when it comes to revisions in the existing rules. The practise today in Karnataka among most successful pharma entrepreneurs here is that they allocate their funds for providing interrupted power by installing generators, dig bore wells to ease water supply and install incinerators to prevent harassments from the State Pollution Control Board. “Entrepreneurs need to reinvest in their profits to further develop their business ventures instead they are spending on infrastructure which is the responsibility of the government, he said.
The reason for investors to rush towards others states except Karnataka is the provision of infrastructure. As long as Karnataka lacks on this front, there is no hope for pharma investments, averred Seth.
According to officials from the Department of Information Technology and Biotechnology, Government of Karnataka, there may not have been investments for pharma manufacturing units, as Karnataka and Bangalore in particular is preferred for setting-up of in R&D labs.
Between January 2001 and December 2002, there have been two major investments: Dr. Reddys investing $10million for a research firm Aurigene Discovery Technologies on the Hosur Road and Saint Life Bio Pharma Private Limited, a pharmaceutical R&D outsourcing company (PRO) will be investing Rs. 30 crore to create a 83,000 sq. feet state of the art facility and employ about 100 scientists. The company has received four and half acres of land and finance from the Karnataka Industrial Area Development Board to set up a state of the art facility in the EPIP Area, Whitefield in the outskirts of Bangalore, which is expected to take off its construction in February 2003.
While the pharmaceutical industry attributes the lack of investments to meagre returns from the sector, officials from the Karnataka Udyog Mitra stated that the State has been receiving enquiries from several pharma manufacturing majors to set up units here, which could be converted into concrete investments.