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Self-reliance push: 3 cos to manufacture priority bulk drugs

India is presently “fully” dependent on imports for these products — penicillin G, 7-aminocephalosporanic acid (7-ACA), erythromycin thiocyanate (TIOC) and clavulanic acid — which is why they were considered for approvals on priority.

By: ENS Economic Bureau | New Delhi |
January 23, 2021 12:47:17 am
drug makers, self reliance, critical drug production, drug manufacturing company, Indian govt, economy news, Indian express newsThe firms have committed to a total investment of around Rs 3,761 crore for setting up these plants, according to the Ministry of Chemicals and Fertilizers, which expects commercial production to commence from April 1, 2023. (Representational)

The government on Friday gave the green light to three drug makers, including one public sector firm, to set up capacities under the production-linked incentive (PLI) scheme to promote self reliance in critical drug ingredients in the country. The firms — Aurobindo Pharmaceuticals, Karnataka Antibiotics and Pharmaceuticals Ltd (KAPL) and Kinvan Pvt Ltd — will be the first to make select bulk drugs under the recently approved scheme.

India is presently “fully” dependent on imports for these products — penicillin G, 7-aminocephalosporanic acid (7-ACA), erythromycin thiocyanate (TIOC) and clavulanic acid — which is why they were considered for approvals on priority.

The firms have committed to a total investment of around Rs 3,761 crore for setting up these plants, according to the Ministry of Chemicals and Fertilizers, which expects commercial production to commence from April 1, 2023. The government would be disbursing up to Rs 3,600 crore in PLI over the agreed six-year period of the scheme. Aurobindo, through subsidiary Lyfius Pharma, will be setting up greenfield capacities to make penicillin G as well as 7-ACA (used to make cephalosporin antibiotics and intermediates). The Hyderabad firm will also be building capacities to make TIOC through subsidiary Qule Pharma.

KAPL will also be manufacturing 7-ACA, while Kinvan will be making clavulanic acid, according to the ministry.

“Setting of these plants will make the country self-reliant to a large extent in respect of these bulk drugs,” said the ministry in a release about the development.

The government in March 2020 had announced its intent to launch a PLI scheme for critical bulk drugs, including key starting materials (KSMs), drug intermediates (DIs) and active pharmaceutical ingredients (APIs). The announcement came a couple of months after Covid-19 cases in China had surged, causing the neighbouring country to shut down several bulk drug manufacturing plants in its Hubei province. This led to the government announcing a restriction on exports of various key drug ingredients. Over the last three decades, India has slowly grown more dependent on imports from China for such ingredients, leading to firms with indigenous capacity to make these raw materials to shut shop, industry executives earlier told The Indian Express. It relies on China for about 70 per cent of its bulk drug imports, as per government figures.

With rising tension between India and China last year and Prime Minister Narendra Modi’s call for India to be more self-reliant in various sectors, the Department of Pharmaceuticals (DoP) last year launched the PLI scheme with a total outlay of Rs 6,940 crore. It sought applications from Indian drug makers to set up greenfield capacity in 36 bulk drugs by November 30, 2020.

A total of 215 applications were received and were to be processed and decided upon by February 28, 2021, according to the Ministry. While the first four bulk drugs that the government has given approvals for come under the first of four target segments of key ingredients, applications under the other three segments are proposed to be taken up for approval in the next 45 days.

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