The high-level committee headed by planning commission member Arun Maira, constituted to study the patterns and future of mergers and acquisitions in pharma sector, is learnt to have failed to resolve the issue in its third meeting and did not submit its final recommendations to the government.
The 8-member panel, set up by the government earlier this year following concerns raised by union health ministry on the continued acquisition of Indian pharma companies by the multinationals, held its third meeting on September 27 but could not finalise the recommendations, sources said. It was expected that the expert panel will finalise its recommendations on the pharma sector in the third meeting and will send the recommendations to the government.
Secretaries of Department of Industrial Policy and Promotion (DIPP), Department of Pharmaceuticals (DoP), ministry of health and family welfare and Department of Biotechnology (DBT), director general, Council of Scientific and Industrial Research (CSIR), chief economic adviser to ministry of finance and Drug Controller General of India (DCGI) are the other members of the panel.
The panel, which was constituted on July 28, 2011, was asked to examine whether changes in the structure of the Indian pharmaceutical industry by acquisitions of the Indian companies by foreign companies can have deleterious effect by reducing competition in the Indian market that could result in increase in price levels of pharmaceuticals in India and less innovation of low cost pharmaceuticals for treating diseases affecting the poor in India.
The panel was also asked to examine whether acquisition by foreign companies will impact availability of pharmaceuticals in India and increase its dependence on imports?; and whether restraints in the flow of FDI for the purpose of acquisition of Indian pharmaceutical companies will unduly constrain the financial resources required for drug discoveries, keeping in mind the large investments are required to develop pharmaceuticals for diseases, including those affecting the poor in India.
It was also asked to consider whether other policies are needed to strengthen the Indian pharmaceutical sector, so as to ensure a vibrant, competitive and innovative Indian Pharmaceutical sector, as also recommend measures for creating an environment conducive for promotion of Greenfield investments in the sector and positioning Indian as the leading quality drug research, development and manufacturing destination.
The panel was asked to finalise the recommendations within two months.