Ayurvedic drug makers struggle to promote herb cultivation

Ayurvedic drug makers struggle to promote herb cultivation
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First Published: Mon, Mar 15 2010. 01 15 AM IST

Cost hurdle: Himalaya Drug Co. chief executive Ravi Prasad estimates the price of cultivated medicinal plants to be as high as five times that of those collected from the wild.
Cost hurdle: Himalaya Drug Co. chief executive Ravi Prasad estimates the price of cultivated medicinal plants to be as high as five times that of those collected from the wild.
Updated: Mon, Mar 15 2010. 10 16 AM IST
Chennai: Ayurveda, the age-old Indian system of healing, is looking for an alternative prescription for a wild addiction.
Even as the traditional system of medicine dating back more than 2,600 years reinvigorates and cures patients using largely vegetable-based drugs, upwards of 80% of the leaves, stems, bark and roots that go into Ayurvedic concoctions are sourced from the wild—a majority from forests and the remaining from wastelands, roadsides and farm bunds.
Cost hurdle: Himalaya Drug Co. chief executive Ravi Prasad estimates the price of cultivated medicinal plants to be as high as five times that of those collected from the wild.
Companies such as Ayurvedic medicine makers Himalaya Drug Co. and Shree Dhootapapeshwar Ltd source just 10-20% of raw materials from contract farmers.
Himalaya chief executive Ravi Prasad estimates the price of cultivated produce to be as high as five times that of those collected from the wild as farmers try to cover the cost of land, organic fertilizer, pesticides and labour.
Farming expertise, such as the amount of space that has to be left between saplings or the best season to cultivate for a higher yield, is also not available for mass cultivation of wild herbs. So a majority of India’s marginal farmers, already reeling under debt and wide price fluctuations for regular harvests of rice, wheat or vegetables, are unwilling to risk herb cultivation.
“The industry has been used to procuring medicinal plants through a network of traders who get their supply through collectors,” says Ranjit Puranik, chief executive of the 137-year-old, Mumbai-based Shree Dhootapapeshwar. “The sector needs to develop an intellect for contract cultivation.”
Meanwhile, the number of people available to collect medicinal plants strewn across wastelands, growing in fields as weeds or within shrinking forests has declined, especially after the introduction of the Mahatma Gandhi National Rural Employment Guarantee Scheme that offers every rural family at least Rs60 a day for 100 days a year of relatively less risky manual work.
The fall in collection of wild herbs threatens the growth of the industry.
Export of herbal products, although worth only Rs1,000 crore according to the National Medicinal Plant Board, is growing at 50%—or double the pace of the roughly Rs90 billion domestic market.
“Ageing populations in Europe or the US are moving towards herbal products for internal and topical health,” said Prasad of the Bangalore-based Himalaya, India’s second largest herbal drugs and nutrition company, behind only Dabur India Ltd. “But product quality depends on raw materials. In the open market, there are always batches that have lower alkaloid content.”
Alkaloids are the naturally occurring chemical compounds in plants extracted for making Ayurvedic products. Lower alkaloid content requires processing of more raw materials to extract a certain amount of active ingredients.
Around 960 species of medicinal plants are used by Indian Ayurveda companies where 178 species are required in excess of 100 tonnes annually, according to not-for-profit Foundation for Revitalisation of Local Health Traditions.
Last month, Himalaya tied up with one of its key suppliers, Gram Mooligai Co. Ltd, to set up a 75-acre nursery of high active ingredient plant species near Madurai in Tamil Nadu. By 2015, Himalaya aims to source 70% of its raw materials through cultivation.
Besides paying a one-time fee of Rs7.5 lakh to Gram Mooligai, which supplies 60% of its raw stock, Himalaya will foot the cost of testing mass cultivation of some herbs. Gram Mooligai, owned by medicinal plant gatherers and small cultivators logging sales of Rs86 lakh last year, will make seeds of tested herbs available for free to farmers who could grow them in between their regular crops and supply the produce to Himalaya.
But Dhootpapeshwar’s Puranik doesn’t believe it will be that easy. “It would be sort of blasphemous for Ayurveda companies to say that I don’t wish to get into cultivation,” says Puranik. “But the truth is that for any company, cultivation of only two-four species is viable.”
Growmore Bio-Tech Ltd’s director N. Barathi couldn’t agree more. Five years ago, Barathi’s company stepped into tissue culture of medicinal plants such as Aloevera—a succulent plant widely added in cosmetics for its moisturizing property—to create exact copies of one of its variants yielding a high level of active ingredient.
But some Ayurveda manufacturers who bought such saplings and distributed them to farmers with a buy-back arrangement at a fixed price reneged on the contract as market prices slipped with increased supply.
In 2005, amid sluggish demand as companies continued to source cheaply from medicinal plant gatherers and farmers remained unwilling to risk mass cultivation of herbs selling for a pittance, Growmore Bio-Tech steered away from herbs to commercial crops.
“Companies feel if raw materials are available in the wild then why should we cultivate it?” says Barathi. “A lot depends on how strictly the government stops forest collections. Only then cultivation will pick up, quality will improve and costs will come down.”
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First Published: Mon, Mar 15 2010. 01 15 AM IST