The SME Pharma Industries Confederation (SPIC), an association of
thousands of small pharma units spread across the country, has urged
Prime Minister Dr Manmohan Singh to keep the implementation of Good
Laboratory Practices (GLP) under abeyance till joint laboratories, as
mooted by department of pharmaceuticals (DOP), are allowed to the
industry. Besides, the SPIC also asked the government to dilute both GMP
and GLP to ensure that the capacity to produce affordable drugs in the
country is not lost forever to allow MNC takeover of Indian companies.
Describing
the huge financial implications of the implementation of Good
Manufacturing Practices (GMP) in 2005 and now the GLP, SPIC secretary
general Jagdeep Singh said that thousands of small and medium pharma
units were closed down including 300 in Maharashtra and 100 in Haryana,
after the implementation of GMP. Now, the GLP has been implemented from
November 1, 2010 despite severe opposition by SMEs. The cost of
upgrading to GMP was at least Rs.1 crore and now GLP shall cost at least another Rs.1 crore. Around 98 per cent SMEs, having less than Rs. 5 crore turnover, simply do not afford it in a prevailing circumstances, hence face closure.
Government
may have given time to SMEs to comply GLP, but it cannot escape the
blame for shrinking SME turnover and making them unviable during the
period. MRP-based excise was levied on medicines from January 2005 by
the union finance ministry, anomalies of which rendered 6000 SMEs
outside the excise free zones of Himachal, Uttarakhand and Jammu &
Kashmir unviable, SPIC said.
The SPIC letter said that though the
excise duty was reduced on medicines but major production remains in
excise free zones. The fact that the change caused revenue loss of
around Rs.10,000 crore and a price rise of
326 per cent (as reported by NIPER in 2006) has been overlooked clearly
indicating that national interest is totally ignored to implement the
agenda of SME elimination in the country. As a consequence of
implementing GMP and GLP, the overhead monthly cost of running an SME
shall skyrocket and the burden of which shall have to be transferred to
the consumer.
Warning the government about the consequences if
the SSIs are eliminated in the country, Jadgeep Singh in his letter to
the PM said that medicines in India cost highest in the world and
shortages prevailed till around 1960 when MNCs ruled the roost in Indian
pharma market. With the advent of SSIs, prices of medicines in India
came down to lowest in the world and shortages vanished. All that shall
be reversed now unless government makes survival of pharma SMEs a
priority. This is essential because 70 per cent Indian population which
earns less than Rs. 90 a day spends an unbearable part of their income on medicines.