The leaders of the pharmaceutical manufacturing industry in Tamil Nadu are of opinion that foreign players can be allowed to invest in export oriented units and on the research and development sectors but they should not be allowed in the domestic companies as it will crush the small scale units.

When the parliamentary panel visited Chennai to take the feedback from the pharma industry people, they met the leaders of TN IPA and TN IDMA and heard their views on the issue. According to sources, the industry people did not raise any objection against allowing FDI in pharma sector unless putting some conditions.

When contacted J Jayaseelan, secretary of TN IPA, who led the team to meet with the visiting panel, responded that foreign direct investment could be allowed through automatic route, it should not come through the approval route. The investment can be for export oriented units and for R&D activities. In the case of domestic business, approval route can be allowed.

According to B Sethuraman, president of the Tamil Nadu pharmaceutical manufacturers association, his association is against allowing FDI on the domestic companies as the foreign players will gradually take over the units wherein they invest. He also favoured in permitting foreign companies invest in export oriented companies and on R&D sector.

Rajaratinam, secretary of IDMA-TN, said the foreign players can become partners of the domestic companies, but conditions should be made that they should not take over the Indian companies in future. FDI can be utilised for strengthening the domestic firms with a partnership agreement with the foreign players, he said.

He further said the discussion with the panel covered three major subjects including FDI, the other two being patent right and DPCO. According to him patent right is a welcome initiative as it encourages research and development. To a query, he said market based pricing of drugs under DPCO is better as cost based pricing is not feasible.