The pharmaceutical sector, which depends on China for over 70% of its raw material, foresees tough times if imports from the eastern neighbour are banned. The lockdown has already left units facing a shortage of raw materials due to logistics hurdles that followed. Cost of Chinese raw material has exceeded the MRP of many drugs, bringing down production, said sources in the industry.
The price cannot be hiked to cover the cost as the medicines are covered under the drug price control (DPC) order, so the drugs cannot be sold above the MRP. Around 30 pharmaceutical units are estimated to be operating in Nagpur currently.
Even before tensions at the borders led to posturing over imports, the lockdown had hit supplies from China. The pandemic had hit production in units in China too, which affected the supplies to India. This has led to a three to four times hike since March in the rates of raw materials or active pharmaceutical ingredients (API) as they are known in the industry.
Subodh Deulgaonkar of Snehal Pharma, at Nagpur, said the API for paracetamol, the medicine for fever now costs double. As against Rs175 a kg before lockdown, the API is now available at Rs350 a kg. The API for antibiotic azithromycin has touched Rs15,000 as against Rs3,500. Similarly, some of the raw materials for antibiotic drugs that were in the range of Rs800 to 900 are now costing Rs2,300 a kg, he said.
Industries have cut down production as the cost has exceeded the MRP. The raw material is supplied by importers, who get the stock from China. The importers have hiked the rates post-Covid, he said.
Deulgaonkar said banning Chinese imports will affect industries. Though production of APIs can happen in India, it will take time.
Anwar Daud of Zim laboratories said if imports are banned, it may lead to a major shortage and even hoarding. This may ultimately take a number of drugs out of the reach of the common man.
“A number of API manufacturing units are in Wuhan province, which was affected by corona. The outbreak had stopped production in China. The situation is getting normalized slowly,” he said.
Bhupesh Kukreja of Adroit Pharmaceuticals said the rising dollar has also contributed to the increase in price of APIs. Around 15 days ago, there was another increase of 20 to 30% in some APIs.
Apart from drugs, even the price of nozzles that are fitted on sanitizer bottles have gone up, as the item is imported from China, added Deulgaonkar. A nozzle that cost Rs7 a piece is now sold for Rs20 to 28, he said.
(With inputs from timesofindia)