Quality pharmaceuticals are the need of the hour more than anytime earlier, as India has earned the name ‘Pharmacy of the World’ by exporting to hundreds of countries. Are we successful in manufacturing needed raw materials [API] in India to sustain these exports? Or else are we going to depend on imports of APIs for ever and thereby at the mercy of other countries? Let us discuss.
Reasons for huge imports
It is said about 84 per cent of our requirements of API is imported, out of which 60 per cent is from China. In value terms it is more than Rs 10,000 crore per annum. [$222 crore in 2014-15 and Rs13853 crore in 2015 -16] At the outset let us ask ourselves, why such large scale import of APIs? Is it just because of price advantage? Is it not pointing out our failure in anticipating the demand? Is it not due to our lethargic attitude towards the production of quality pharmaceuticals? Is it not indicating the failure of industry associations in pressuring Indian Govt in time to do something about it? Well, when India started exporting generic medicines in huge quantities, we should have awakened. But, now only the Govt of India has started taking some steps like convening the meetings stake holders, which may bring a solution to the problem later. It is an accepted fact that to solve any problem ,we should know the etiology of it.
Why no indigenous production of API?
For any industry to survive and sustain , a reasonable return on the investment is the first requirement. But here international market forces determine it via the price of APIs produced, thanks to globalization and free trade agreements! It is said Chinese APIs are four times cheaper than our indigenous production. In other words, our price of APIs are 400 per cent costlier than the price of imports from China! We all know cost of production of any material is determined by many factors like raw material cost, conversion cost, Govt support by way of subsidies and production volume. According to some reports, for China the last two factors –Govt support and large scale production—are the key advantages in supplying APIs at very competitive price, both of which are possible here in India also, as we are next only to China in population. What is required is equitable distribution of medicines to all of our population which is possible in a socialist society like China, not in a country with a capitalist govt. As many studies have pointed out, reach of medicines to 75 per cent of our population living in rural area is very poor. The result is we supply medicines only to urban rich and middle class; hence our production volume is less, which cannot be changed unless there is a policy change.
Secondly, bulk drug production itself depends on formulation units and their demand for API is market driven and hence there may not be demand for particular API for ever. Unlike a formulation unit, a bulk drug unit cannot change its production from one product to another easily for obvious reasons like production processes, machinery and requirement of knowhow etc. Compare this with switching over of production of liquid orals A or B or C or tablets X, Y or Z by formulation units just like that.
Apart from the above discouraging factors, usual red -tapism, corruption, insufficient infrastructure, long gestation period etc also make the prospective Indian entrepreneur to think twice before investing in bulk drug production. Govt can protect indigenous industry by imposing anti-dumping duty or heavy customs duty on the imported product as it is usual for all goods. But that makes the govt machinery on a tight spot to plug our porous borders and long coast line for preventing smuggling of APIs. Who is verifying the purchase bills of every raw material of every batch of medicine manufactured in India? Where is the man power and will power? Thus less production volume, uncertain demand, bureaucratic hurdles, smuggling of APIs etc discourage production of APIs in India. Is there any way out?
What to do?
National leaders like Nehru and Indira Gandhi have shown the way. We left it in the middle and even started making fun of it. That’s why this predicament in bulk drug production. Jawaharlal Nehru considered all these problems and made agreements with countries like Soviet Union for the production of APIs. Then Indian Govt started companies like Hindustan Antibiotics Ltd and Indian Drugs and Pharmaceuticals Ltd [IDPL] in public sector for the purpose. We have killed them or turned a blind eye when they were slowly dying. The present govt is reluctant in reviving or modernizing those bulk drug production units. Even industries benefited earlier by those companies also did nothing to sustain them by thanklessly forgetting their raw material supplier. As long as cheap raw material from China is available legally or illegally why should one bother about local production units? Is it not?
But a statesman with long -term vision cannot remain indifferent to the situation. Talk to governments of API exporting countries including China, arrive at MOU to start either joint venture or fully owned govt facilities in India for APIs. Earlier Soviet Union not only supplied machinery and knowhow, but also gave training to hundreds of our scientists and technocrats in bulk drug production. Arrive at similar arrangement with willing countries.
Start and support local efforts
Apart from the above ,Indian Govt should invest in indigenous research activities for production of quality pharmaceuticals at cheaper costs. It should give liberal funds for R&D activities of both academic and research institutions. Institutions like Indian Institute of Technology can be asked to take up this research on a priority basis. As justifiably feared by all, if for one reason or other China stops its export of APIs to India, not only the ‘Pharmacy of the world’ will collapse by not able to export quality generics to the world but also it will affect local supply resulting in havoc throughout the country. Thus it is a matter of life and death. Hence all other research like space research can wait, push for invention of cheaper methods of production of APIs.
Manpower
Once research is successfully completed, there should be technocrats ready to take up the large scale production of APIs. Hence we must plan for manpower requirements now itself. Pharmacy Council of India has recently introduced new syllabus for B.Pharm and M.Pharm that should be improved with compulsory industrial training of one year [Nine months in formulation unit and three months in bulk drugs units] after graduation, if not for all pharma graduates at least for the students who apt for industrial pharmacy specialization. If more prospective job opportunities are on the horizon, more and more pharmacy students will take up the course automatically.
This apart, Govt should start separate ministry of pharmaceuticals and drugs control as proposed recently. Present peculiar scenario of Dept of Pharmaceuticals with one ministry and drugs control with another ministry should be put to an end. As manpower planning for production in industry and distribution of drugs needs to be taken care, Pharmacy council of India can also be brought under the new ministry.
Thus production [mfg], distribution [sale], regulation [drugs control] and education [PCI] related to pharma field can be under one umbrella of Ministry of Pharmacy services akin to Ministry of Health services. Time has come, stop talking, start walking towards the goal!
(The author is ex president, Indian Pharmacy Graduates Association, Madurai,
Tamilnadu)