The SME pharma industries confederation (SPIC), an apex body of over 1000 small pharma companies spread across the country, has sought prime minister Dr Manmohan Singh's intervention in solving the burning issues being faced by the small pharma industries, which it believes are mostly created by lack of inter-ministerial coordination between the Union ministries of finance, chemicals and fertilizers (administrative ministry) and health which is the regulatory ministry for the pharma industry.

In a representation, SPIC has asked the prime minister to ensure inter-ministerial coordination by stipulating that no change which affects the small and medium pharma companies should be brought by any ministry, (whether it is Finance, Health or DOP), without consulting the development commissioner of the Ministry of small and medium enterprises (MSME).

SPIC secretary general Jagdeep Singh said that the major cause of SSIs' problems is the lack of coordination between the different union ministries and vested interests have managed to prevail over national interests and shall continue to do so as long as decisions are made arbitrarily by the ministries without consulting the MSME development commissioner about the repercussions of their policies on the SSIs.

Singh said that the dilution of FDI norms made MNCs make a beeline to India. The favourite route is takeover of big Indian houses. Ranbaxy’s sale to Daiichi Japan was the beginning. MNC’s new molecules which raked in millions have dried up but enough funds are available to buy out Indian companies which is a lucrative alternate to blockbuster drugs. Reason is that our country is the biggest “mandi” of the world owing to burgeoning middle class whose income doubles every 6-7 years.

But to profiteer in India, 6000 Pharma SMEs who provide competitiveness need to be eliminated. During the last six years, pharma MSMEs have been repeatedly pounded with several illogical changes in law and policy for the purpose. Such is the power of vested interests that even PMO has been marginalized in matters like removing anomalies of MRP-based excise levied on medicines in January 2005 sacrificing revenue, affordable drugs and quality in the process, counter to the objectives of change.

Singh said that the SSIs feel cheated as on the one hand they have been mandated to upgrade their units as per GMP norms at a huge cost and on the other hand MRP based excise collection rendered them uncompetitive.

Each one of the changes brought by the government has resulted in some MSMEs having to struggle or close down. While China is making inroads in international market to poach on India’s exports worth Rs 50,000 crore, Indian government is busy in closing down its own industry to appease the MNCs. It may be recalled that earlier India had handed over the initiative to China in bulk drugs and the lost ground can never be recovered. Same could very well happen to pharma formulations, SPIC cautioned.