The Karnataka Drugs and Pharmaceutical Manufacturers Association (KDPMA) has played down the fear that more than 30 per cent of pharmaceutical manufacturing units will close down once the GMP norms come into force. Denying that 60 per cent of the firms are still not GMP compliant, the KDPMA maintains that a mere two per cent of the total 219 units in the state may not be able to comply with GMP because of financial crunch and the small scale of operations.
Experts have expressed serious misgivings about the state's pharmaceutical units and say that in the small scale sector there is lack of expertise and guidance on GMP compliance. According to reliable sources, firms are still not prepared to accept GMP even if they are provided monetary assistance that is required to become GMP compliant.
KDPMA has, however, chosen to project a contrasting picture. According to N Jatish Seth, secretary, Karnataka Drugs and Pharmaceutical Manufacturers Association, there are around 150 units in the small scale sector and nearly 125 of them are 70 per cent ready with GMP requirements and in the next nine months the units will be fully ready.
The units in the state have received a fillip in GMP compliance with the assistance coming in from the Karnataka State Financial Corporation (KSFC) through a technical upgradation scheme, which provides loans between Rs. 2 lakh to Rs. 1 crore at 12 per cent interest. In fact, if companies repay on time a four per cent rebate in the interest is offered every quarter.
Jatish avers that it is highly unlikely that there could be any companies here which will not be able to meet the GMP compliance. Concerted efforts to survive in post GMP regime is perceptible and the extension up to December 31, 2004 is a big relief.
The state has a forward-looking industrial outlook and the units at any cost will upgrade or go in for a merger rather than perish. There could be two per cent of entrepreneurs who might not be able to comply with at all because of massive infrastructure investments which is beyond their financial capacity.
Primarily, the main ingredient required for being GMP compliance is the mindset to survive. The units must evaluate capital investments, joint ventures, strategic alliances and merger opportunities. Strategies are being evolved in that direction among units in the state to stay alive, stated KR Ravi Shankar, president, KDPMA.
For Karnataka, which has so long maintained stringent manufacturing practises, has fulfilled several requirements. One of them being the 'concept of self inspection' which was already existent in Karnataka since 1995, there should be no problem for the units to comply with GMP said senior government officials on condition of anonymity.
The revised Schedule M released in December 2001 is more exhaustive than its earlier version of 1988 and the norms recommended are on par with the WHO (World Health Organization) standards. The cost of a unit to be able to comply with the GMP standards depends on its size and is a variable.
In the case of infrastructure, companies might find it difficult to increase their existing production space and would have to go in for additional facility within the premises or outside which requires considerable capital investment.
The December 2004 time limit given to pharmaceutical companies for GMP compliance should be acceptable, since modifying a plant could be done within a time frame but it is an expensive proposition and financial resources could become a major constraint. The cost of infrastructure for GMP and personnel training is high. The need for strictly complying with the norms must come from the people at the top. The basic tenets of GMP are cleanliness, comprehensive and true documentation of procedures, on-time delivery and zero defects, points out Jatish.
Most companies in the state have realigned their business plans to suit the future requirements. The small scale units have focused on the potential opportunities in the global pharmaceuticals and have now revamped their operations to allow international and domestic audits to tap the outsourcing opportunities, stated Jatish.
According to the state drugs control department hopefully the units will take the deadline seriously because it is a challenge for both the department and the units to ensure compliance before end of 2004.
Many manufacturing facilities will have to undergo substantial modification and this could be difficult in terms of resources as the cost involved in redoing an existing plant works out to be much higher than constructing a new facility. There is a need of a systematic planning. There is no choice for companies, as they either have to go for GMP compliance or quit the line of drug manufacture, said a section pharma industry officials whose units re already complied.
The most difficult requirement of GMP is to incorporate the structural changes in the facility, which include shifting, relocating, and upgrading, besides redoing the entire utilities and services, such as, air-supply, power, water etc., in a cGMP acceptable manner. The cost is substantial as expenses have to be incurred in high engineering capability (civil, mechanical, electrical and electronics) and purchase of top quality equipment, states a section of engineering consultants.
For a GMP complied unit, at least 70 per cent of the cost was allocated towards instrumentation and the remaining set-aside for hiring skilled work force that comes at a high price, states Dr KN Subbaswami, former president, KDPMA during a seminar on validation held last ear. If the testing of drugs/products could be outsourced then small units can streamline their competencies and focus on contract manufacturing at their existing units which needed only small amount of funding, he informs.
While there are suggestions by a section of small scale units to lobby with the Karnataka government to provide financial assistance for them to be GMP complied in their area of operation, no such move has been made as yet.