Himachal’s Drug Industry Reeling Under Chinese Imports

By: Dec 30th, 2017 12:12 am

Price of raw material imported from China have increased by 30% to 100% in past few months

Vipin Sharma

The dependency of drug companies for raw materials on China seems to be proving heavy for them now. The price of Active Pharmaceutical Ingredients (API) imported from China has increased by 30% to 100% in past few months. It has increased the production cost also thus hitting profit margin of companies. The soaring prices of API has unsettled drug companies based in Himachal too.

The companies here have decreased production to avoid huge losses because of costly raw material. Notably, the World Health Organisation and pollution department of China have closed many bulk drug industries there failing to meet set standards. Since Indian drug companies import maximum of raw material from China, therefore it has its effect on Indian drug companies too.

The drug manufacturing companies could not ensure continuous production if they starts purchasing bulk drugs from India, as the bulk drug companies here could not ensure availability of raw material as per market demand. Many raw material sellers have stocked intermediate raw material imported from China.

Now they are demanding exorbitant price from companies for the stocked raw material. The surge in prices of raw material imported from China has affected export too. However MRP of drugs cannot be increased due to increase in price of raw material because as per rules MRP of drugs is not set as per price of raw materials. But the drug companies can present their case to National Pharmaceutical Pricing Authority (NPPA) in case they have any problem.

According to drug manufacturers, there is great demand of antibiotic Amikacin injection in Indian market. The government has set the MRP of 250mg injection at Rs. 31.48 in 2013. the price of raw material for it during that time was Rs. 7000 per kilogram. The same price soared to Rs. 10,000 per kilogram in 2016, but the price of injection was same. And now the rate of raw material has jumped to Rs. 21,000 per kilogram in 2017.

Notably drug industries based in Himachal, that manufactures 35% of drugs of Asia, imports 90% of bulk drugs from China. Former Chairman of Confederation of Indian Industry (CII) Arun Rawat the drug industry of the country is under great pressure because of heavy surge in prices of API imported from China. The production cost has increased to a great extent and profit margin has reduced greatly because as per directions of NPPA MRP of drugs cannot be increased beyond a set value. Therefore drug companies have reached to a stage where they will have to either stop production or have to sell them bearing heavy losses, added he.


Keep watching our YouTube Channel ‘Divya Himachal TV’. Also,  Download our Android App