The pharmaceutical manufacturers in Kerala are upset over the new clauses on price preference for local small-scale manufacturers in the new policy guidelines on procurement of drugs and supplies to the government run hospitals in the state.

As per the new policy announced by the state last week, price bids of SSI units in Kerala quoting less than 15 per cent above the L1 rate alone will be considered, and has added a clear provision stating 'price bids of SSI units in Kerala quoting more than 15 per cent above L1 rate will not be considered under any circumstance.'

In the earlier provision so far followed by the Central Purchase Committee (CPC) of the state health department as per the store purchase manual, local SSIs along with the PSUs were called for negotiations even if they quoted more than 15 per cent above L1 rate in the tender. The new policy, however, maintains status co in the case of local PSUs and stipulates 'PSUs in the Kerala State will be invited for negotiations irrespective of the price quoted,' sources told Pharmabiz.

When contacted, Dr. A M D Namboothiri, president of the Kerala Pharmaceutical Manufacturers Association (PMA) said the association would strongly protest against this injustice to local manufacturers. "The association office bearers would meet this week in Kochi to decide the future course of action and solutions," he added.

Informed sources said though the association had represented on this to the state health minister, some of the top officials in the state health department were keen to include the provision of excluding local SSIs quoting above 15 per cent of L1, and the representation was not considered by the policy makers.

However, the policy has given some relief to the state SSIs with provisions to insist only minimum one-year market standing for Kerala SSIs and to exempt them from turnover condition. In the case of other state manufacturers, eligibility conditions include minimum three-year market standing and minimum turnover of Rs 5 crore per annum for last three years.

The pharmaceutical manufacturers also complain the government neither gave a proper representation for the pharmaceutical manufacturers in the committees that framed the policy nor listened to their suggestions and grievances. Out of the 90 odd pharmaceutical manufacturers in Kerala, more than 90 per cent are surviving alone on the hospital supplies and government orders. The Kerala Government annually procures drugs and hospital supplies worth over Rs 100 crore.

It is to be noted Pharmabiz had reported in detail the salient features of the draft policy announced by the State Government a fortnight ago. The policy, subjected for revision only after three years, was announced after detailed discussions with the stakeholders involved and considering the public opinion, the state health minister had claimed while announcing the policy.