Against the backdrop of the COVID-19 pandemic in India, a US$1.3 billion fund will be established to bolster Indian pharma and promote domestic manufacturing to reduce import dependency.
The report, published in BloombergQuint, identifies “supply chain disruptions due to the coronavirus pandemic” as the rationale behind the decision, noting that Indian pharma’s reliance on China for imports of pharmaceutical ingredients underscored key weaknesses for the sector in the context of COVID-19. The US$1.3 billion will seek to strengthen pharmaceutical infrastructure in the country and provide incentives “of up to twenty percent of incremental sales value over the next eight years” Bloomberg said, citing a statement issued by the Government.
As previously noted by Health Issues India, “Chinese imports account for between eighty and 85 percent of India’s API [active pharmaceutical ingredient] imports.” Citing a Hindu Business Line report, we added “in broader terms, China accounted for 67.56 percent of India’s Rs 25,552 crore worth of imports of “all bulk drugs and intermediates” in the 2017-18 fiscal year.”
As reported by IANS, a multi-thousand crore fund for boosting domestic production of products including medical devices and APIs has been announced by the Union Government. This includes an initial Rs 3,000 crore to establish “three bulk drugs parks…that would create common infrastructure facilities that support bulk drug manufacturing.” States will receive grants of up to Rs 1,000 crore annually for each park, as well as an incentivisation scheme budgeted at Rs 6,940 crore for bulk drug productions awarded to manufacturers of 53 identified bulk drugs. The Government anticipates this programme to lead to incremental sales worth Rs 46,400 crore over an eight-year period. Medical devices have also received an Rs 3,820 crore boon from the Government.
Indian pharma has welcomed the news. The Indian Pharmaceutical Alliance touted the Government’s decision to bolster domestic manufacturing, with its president Satish Reddy – chairman of Dr Reddy’s Laboratories – stating “India has the capability and competence to manufacture all APIs. The announcement by the Government will help revive the API industry in the country and will help the sector regain the dominance that was lost over the years.” The IPA described India as “the pharmacy of the world” and noted that the country accounts for one-fifth of the global market for generic medicines.