The current shortage of Vitamin C bulk felt in the domestic market is mainly due to the inability of the domestic manufacturers to increase their production to cater to the market at the controlled price, according to Karthikeya Sarabhai, chairman and managing director, Ambalal Sarabhai Enterprises (ASE), the largest producer of Vitamin C in the country. Imposition of import registration has never been the cause for such shortage and rationalizing the price at domestic front is the solution to it, he said.
Vitamin C bulk manufacturers are at present not in a position to operate at the full capacity as the price of Ketogulonic Acid, the main raw material used for manufacture of Vitamin C, which is currently imported from China, and other input costs have escalated multifold after the government cut the drug price September last. The price for Ketogulonic Acid shot up due to the Chinese manufacturers drastically cutting the supply of the raw material in order to increase their exports of Vitamin C itself. The raw material price, which is being quoted at $5.5 per kg now, used to be almost half the price few months ago.
At the same time, the formulation prices which are also been capped in proportion to the bulk price impacts the manufacturers affordability to buy the bulk drug at the current market price and sell the finished product at the notified price. In India, ASE and Amoli Organics are the leading manufacturers of Vitamin C bulk.
Since the bulk drug industry has already represented to the government that the notified price for Vitamin C has to be revised with immediate effect, the government has considered the case positively. Vitamin C is likely to be outside DPCO as per the government critieria of exclusion. "Had the new DPCO announced at the right time as it was proposed, it would have made Vitamin C out of its gambit and the bulk drug manufacturers would have been able to utilize the maximum capacity to cater to the market," Sarabhai said.
With the current price control norms, the Vitamin C bulk prices have been capped by the government at Rs. 419 per kg. But, the market price is Rs. 700-800 a kg, which companies consider a violation of price control norms.
Currently the market requirement for Vitamin C is around 100 tonnes a month. ASE itself has production capacity of about 100 tonnes a month, which is currently operated only at the half capacity due to high production cost. Sarabhai said that at present ASE has limited its supply to only few specified companies due to unaffordable cost-price situation.
It may be recalled that local formulation companies have warned that rising bulk prices could affect the availability of their products. Leading vitamin brand marketers GlaxoSmithKline (GSK) and Pfizer have even went on record that there is a scarcity of Vitamin C bulk drug - the key ingredient in the product they procure from third parties - and that rising prices of bulk were impacting their profitability.
The formulation makers have attributed the vitamin's scarcity is largely due to Chinese companies' reluctance to register with the government for exports to the country. However, the bulk drug manufacturers said that the import registration norm has nothing to do with the scarcity of Vitamin C and import registration is must to ensure the quality of imported materials, which every country has imposed in its own way.
At present, most of the vitamin C is imported from China or Europe through official and unofficial way. Sarabhai added that even if the government removes the import registration for Chinese and European companies, they are not going to supply the product at price lower than the international price through the official channel. In fact, the formulation makers have asked the government to revise bulk prices upwards taking into account ground realities, so that they can also revise their finished medicine prices.